Question

Mika opened a bank account that earns simple interest with an initial deposit of $2,200. She made no other transactions throughout the year. At the end of the year, Mika had $2,260.50 in her account. What was the simple interest rate?

Answer 1

Answer: 2.75 %

Explanation:

Here, the Principal amount or initial amount, P = $ 2200

The Amount by getting simple interest on the amount, A = $ 2260.50

Time, t = 1 year,

Simple interest rate, r ( let)= ?

Since, The amount in Simple interest,

`A = P + (P* r* t)/(100)`

⇒
`2260.50 = 2200 + (2200* r* 1)/(100)`

⇒
`2260.50-2200 = (2200* r* 1)/(100)`

⇒
`60.50=22 r`

⇒
`r = (60.50)/(22)` = 2.75 %

Thus the simple interest rate = 2.75 %