Problema Solution
Determine the simple interest rate at which $1,500 will grow to $1,550 in the 8 months. Round your answers to the nearest tenth of percent.
Answer provided by our tutors
A = $1,550 future value (principal + interest)
P = $1,500 principal amount
r = rate of Interest per year in decimal; r = R/100
t = 8/12 = 2/3 years time period involved in years
A = P(1 + rt)
1550 = 1500(1+r(2/3))
by solving we find:
r = 0.05 or 5%
click here to see the step by step solution of the equation:
the simple interest rate is 5%.