Question

Greta had $2,992 in a savings account with simple interest. She had opened the account with $2,200 exactly 4 years earlier. What was the interest rate?

a) 3%
b) 4%
c) 5%
d) 6%

Answer 1

The interest rate on Greta's savings account is approximately 9.09%.

Step-by-step explanation:

In this case, we can use the formula for simple interest:

Simple Interest = Principal × Rate × Time

Given that Greta had $2,992 in her savings account after 4 years, and she had initially deposited $2,200, we can calculate the interest as follows:

Interest = $2,992 - $2,200 = $792

Now, we can substitute the values into the formula to find the interest rate:

$792 = $2,200 × Rate × 4

Dividing both sides of the equation by $2,200 × 4 gives us the interest rate:

Rate = $792 / ($2,200 × 4) = 0.0909

Converting the decimal to a percentage, the interest rate is approximately 9.09%.