Question

you borrow $660 dollars from your brother and agree to pay back $720 in 7 months what simple interest rate will you pay

Answer 1

The formula to calculate the simple interest rate is:

`R=((1)/(T))((A)/(P)-1)`

Where R is the simple interest rate (in decimal form), T is the time, P is the principal (the initial amount borrowed) and A is the total amount paid after time T. In this case:

`\begin{gathered} T=7 \\ A=720 \\ P=660 \end{gathered}`

Substituting these values into the formula:

`R=((1)/(7))((720)/(660)-1)`

Solving the operations:

`R=(1)/(7)(0.09090909)`
`R=0.012987`

To convert this simple interest rate into a percentage, we multiply it by 100:

`0.012987*100=1.2987`

This is the simple interest rate per month:

R=1.2987 % per moth

We can also calculate the simple interest rate per year by multiplying the previous result by 12 (this is because there are 12 months in a year)

`1.2987*12=15.5844`

The simple interest rate per year is:

R=15.5844 % per year

Answer:

R=1.2987 % per moth

R=15.5844 % per year