Question

If you made $280.80 of simple interest after saving $1800 for 3 years, what was your interest rate?

Answer 1

~5.2%

Interest = (Principal Amount) x (Rate) x (Time)

In your case:

Interest = $280.80

Principal Amount = $1800

Time = 3 years

You want to find the interest rate (Rate). Rearrange the formula:

Rate = (Interest) / [(Principal Amount) x (Time)]