Question

After 4 years aspen earned $510 in simple interest from a cd into which she initially deposited $3000. What was the annual interest rate if the CD

a) 13%
b) 11.75%
c) 4.25%
d) 8.5%

Answer 1

I = PRT...and since we are looking for r.....I / PT = R

I / PT = R
I = 510
P = 3000
T = 4

510 / (3000 * 4) =
510 / 12,000 =
0.0425 .....multiply by 100 to get the percent
4.25% <==

Answer 2

Annual interest rate is

c) 4.25%

Explanation:

let amount deposited=P=$3000

time period=T=4 years

annual interest rate=R

Simple interest=I=$510

by the formula bof simple interest

`I=(P* R* T)/(100)\\ \\510=(3000* R* 4)/(100)\\\\R=4.25\%`

hence, annual interest rate is 4.25%

hence option c) is correct