Question

If you borrow $500 from a credit union at 12% annual interest and $250 from a bank at 18% annual interest, what is the effective annual interest rate (that is, what single rate of interest on $750 would result in the same total amount of interest)?

a. 10%
b. 12%
c. 14%
d. 15%

Answer 1

C. 14 % i got the correct answer

Explanation:

Answer 2

14% that is option c is correct.

Explanation:

We have been given that $500 from a credit union at 12% annual interest and $250 from a bank at 18% annual interest

That means we will get

`500\cdot 0.12+250\cdot 0.18=105`

Since, we need to find the single rate of interest on 750

So, the required rate of interest will be:

`(105)/(750)=0.14`

That is 14%

Therefore, option c is correct