Problema Solution
A Man needed money to buy lawn equipment. He borrowed $700.00 for eight months and paid $53.97 in interest. What was the rate of interest?
Answer provided by our tutors
P = $700.00
t = 8 months = 8/12 yr = 2/3 yr
I = $53.97
r = rate of interest as a decimal
Assuming the interest is simple we have:
I = P*r*t
700.00*r*(2/3) = 53.97
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click here to see the equation solved for r
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r = 0.11565 or 11.565%
The rate of interest is 11.565%.