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Troy made $30,000 in interest by placing $40,000 in a savings account with simple interest for 5 years. What was the interest rate?

User Najib
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Answer:
the interest rate for the savings account is 15%

Explanation:

We can use the formula for simple interest to solve this problem:

Simple Interest = Principal x Rate x Time

Where:

Principal is the amount of money invested

Rate is the interest rate (as a decimal)

Time is the length of time the money is invested

We know that Troy placed $40,000 in a savings account with simple interest for 5 years and earned $30,000 in interest. So we can plug these values into the formula to get:

$30,000 = $40,000 x Rate x 5 years

Simplifying this expression, we get:

Rate = $30,000 ÷ ($40,000 x 5 years)

Rate = 0.15 or 15%

Therefore, the interest rate for the savings account is 15%.

User No Nein
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