Answered

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Matt paid $450 in interest on a 15 month note for
$5600. Find the rate of interest paid.

Sagot :

MrRoyal

Answer:

The rate is 6.43%

Step-by-step explanation:

Given

[tex]I = 450[/tex] --Interest

[tex]P = 5600[/tex] -- Principal

[tex]T= 15\ months[/tex] --Time

Required

Determine the rate

Using simple interest formula:

[tex]I = PRT[/tex]

Make R the subject

[tex]R = \frac{I}{PT}[/tex]

Convert time to years

[tex]T= 15\ months[/tex]

[tex]T =\frac{15}{12}\ years[/tex]

[tex]T =1.25\ years[/tex]

Substitute values for I, P and T

[tex]R = \frac{450}{5600*1.25}[/tex]

[tex]R = \frac{450}{7000}[/tex]

[tex]R = 0.0643[/tex]

Convert to percentage

[tex]R = 0.0643*100\%[/tex]

[tex]R = 6.43\%[/tex]

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