Question

Find the annual interest rate paid on this loan:

interest = $75; principal = $5,000; time = 3 months

Answer 1

Well, to get annually, it is every year, so you would have to multiply the interest by 4(because 3 months times 4 is 12 months, and 12 months in a year)to get it yearly
75 x 4 = 300
Now divide 300 by 5,000
300/5000 = 3/50(divide each by 100)
Now multiply each by 2 to get a 100%, because it is ony at 50% right now
3 x 2 = 6, 50 x 2 = 100
6% is your answer, hope this helped!

Answer 2

$75/$5000 every 3 months. 12 months in a year, so 4 times 3 months in a year.
Therefore the interest payed every year is $75 times 4. This is $300. $300/$5000 = $3/$50 = $6/$100. The numerator of the fraction is the desired percentage; 6%.

6%