Question

2. A man needed money to buy lawn equipment. He borrowed $800.00 for 7 months and paid $53.94 in interest. What was the rate of interest?

Answer 1

Answer:

The rate of interest is 11.558% per annum paid simply.

Step-by-step explanation:

Using the formula of simple interest we have

$S.I=\frac{P\times r\times t}{100}$

where

S.I = simple interest

P = Principal amount deposited

r = interest rate

t = time period for which the principal amount is deposited.

Applying values in the above expression we get

$53.94=\frac{800\times r\times 7}{100\times 12}\\\\\therefore r=\frac{53.94\times 100\times 12}{800\times 7}\\\\r=11.558$