Question

Kyle paid $96 in interest to borrow $7200 for 4 months.

What annual interest rate did Kyle pay?

A.
1.33%

B.
4%

C.
5.33%

D.
16%

Answer 1

so we know that 4 months is 1/3 of a year. therefore, the interest kyle would've paid in a year would be 96x3, 288. now we just need to know what the interest rate for a year was. we find the interest rate by dividing the annual interest by the total amount borrowed. 288/7200+0.04, so the answer is B, 4%.