Question

If you invest money, after a certain period of time you’ll get interest. For example, if you invest $2,000 at 5% annual interest rate, in a year you will have $2,000∙0.05=$100 of annual simple interest in addition to the original amount.

If you invest $300.00 and your annual interest is $27, what is the interest rate?

Answer 1

your interest rate would be 9%

because 27 divided by 300 = 0.09

the you move the decimal 2 places to the right to get your percentage

Answer 2

Total = Principal * (1+rate)^years
Total = 300.00 * 1 + rate
If we earn $27 interest then total = 327
327 = 300 + (1 + rate)
327/300 = 1 +rate
1.09 so rate = 1.09 minus 1 or
.09 which equals
9%