Problema Solution
Find the interest rate if $32 increased to $50 in 2 years . Write your answer as a percent.
Answer provided by our tutors
Let
r = the simple annual interest rate
P = $32 the principal
A = $50 the future value
t = 2 years
Assuming that the interest is simple we have:
A - P = P*r*t
r = (A - P)/(Pt)
r = (50 - 32)/(32*2)
r = 0.2813 or 28.13%
The simple annual interest rate was 28.13%.