Question

Miwa borrows $1250 for 1 year. At the end of the year, she pays $112.50 in interest. Find the rate of interest she was charged.

Answer 1

Answer: 10%

Step-by-step explanation: The formula to calculate simple interest is Interest = Principal x Rate x Time

With the number in the formula, 112.50 = 1,250 x r x 1

Simplify:

112.50 = 1,250r

Divide both sides by 1,250:

.1 = r

Therefore, the rate is 10%