Question

Your bank gives you a special loan of $112,000. At the end of 30 years, you will pay the bank $176,400 in simple interest. What is the annual interest rate on your loan?

Answer 1

Interest , I = PRT/100

R = 100I / PT.

P = 112 000. T = 30 years. Interest = 176 400.

R = 100 * 176 400 / (112 000 * 30)

R = 5.25

Rate = 5.25% per year.

Answer 2

woah
that's alot of interest

ok so simple interest is the same every year
therefor if the total interest is 176400 in 30 years, then the interest for 1 ear is 176400/30=5880

ok so now
112000 times x%=5880
percent means parts out of 100 so x%=x/100

112000 times x/100=5880
112000x/100=5880
1120x=5880
divide both sides by 1120
x=5.25
answer is 5.25%