Question

if the simple interest on $800 for 3 years is $60, what is the rate of interest per annum

Answer 1

Answer:

2.5%

Step-by-step explanation:

Simple interest formula

I = Prt

where:

• I = total interest
• P = principal
• r = interest rate (in decimal form)
• t = time (in years)

Given:

• I = $60
• P = $800
• t = 3 years

Substituting given values into the formula and solving for r:

⇒ 60 = 800 · r · 3

⇒ 60 = 2400r

⇒ r = 0.025

Converting r to percentage:

0.025 × 100% = 2.5%

Answer 2

Answer:

2.5%

Step-by-step explanation:

Given:

• Principle: $800
• Time: 3 years
• Simple interest: $60

Formula:

Simple interest = (Principle × Rate × Time)/100

Substitute the principle, time and the interest in the formula to determine the rate of interest per annum.

$\implies 60 = \dfrac{ (800 \times \text{Rate} \times 3)}{100}$

Divide 100 to 800 as 800 is the only number in the equation that is divisible by 100.

$\implies 60 ={ (800 \div 100)\times \text{Rate} \times 3}$

$\implies60 ={ 8\times \text{Rate} \times 3}$

Simplify both sides of the equation:

$\implies60 ={ 24\times \text{Rate}}$

Divide both sides by 24.

$\implies\dfrac{60}{24} =\dfrac{{ 24\times \text{Rate}}}{24}$

Simplify both sides as needed:

$\implies\dfrac{60}{24} = \text{Rate}$

$\implies\dfrac{60 \div 12}{24 \div 12} = \text{Rate}$

$\implies \text{Rate} = \dfrac{5}{2} = 2.5$

Thus, the rate of interest per annum is 2.5%.