Question

Kate has $400. She wants to have $430 to buy a couch. How much interest would she have to earn in order to get the additional $30?

Select the best answer from the choices provided.
A. 3%
B. 4.5%
C. 6%
D. 7.5%

Answer 1

D) 7.5%

Explanation:

We can solve this through guessing and checking, or we can do this mathematically. We will try both approaches.

Mathematically:

We know that to get the extra $30 if we have $100, is a 30% interest. Now, since we have 4x 100, and these numbers are inversely proportional, we will need to divide 30 by 4. Doing this gives us 30/4 = 7.5, so the answer is 7.5%.

Guess and Check:

This way is a bit slower, but we will go through each answer and find how much money we would get from them. So, we would take our percent, change it to a number of that percent, considering we are taking it from 100, and multiply it by 4 since we have $400. We will get each of these respectively:

A) 3% = 3 * 4 = $12

B) 4.5% = 4.5 * 4 = $18

C) 6% = 6 * 4 = $24

D) 7.5% = 7.5 * 4 = $30

As you can see, D) gives us that extra $30, so the answer is D) 7.5%.

Hope this helped!

Answer 2

The best answer is 7.5 percent because when you multiply 400 x 1.075 you get a sum of 430