Final answer:
A $5,000 loan over three years at 6% simple interest would incur $900 in interest. A loan of $10,000 over five years that accrues $500 in simple interest would have had an interest rate of 1%.
Step-by-step explanation:
To calculate the total amount of simple interest from a $5,000 loan over three years with a simple interest rate of 6%, you can use the simple interest formula:
I = Prt,
where I is the interest, P is the principal amount (the initial loan amount), r is the annual interest rate (as a decimal), and t is the time in years. Plugging in the values:
I = $5,000 * 0.06 * 3,
I = $5,000 * 0.18,
I = $900.
The total interest after three years would be $900.
To answer the second question regarding the interest rate charged for a $10,000 loan with $500 interest received over five years, use the same formula rearranged to solve for r:
I = Prt ⇒ r = I / (Pt)
r = $500 / ($10,000 * 5),
r = $500 / $50,000,
r = 0.01 or 1%.
The interest rate charged would be 1%.