Question

Joseph invested an amount of R12 000 at a bank. He invested his money for 10 years at a 7.5% p.a. simple interest rate.

At what interest rate did Joseph invest his money?​

Answer 1

7.5% per annum.

Explanation:

To find the interest rate at which Joseph invested his money, we can use the formula for simple interest:

Interest = Principal × Rate × Time

Given that Joseph invested R12,000 for 10 years, and earned a total interest of R9,000 (which is 7.5% of R12,000 for 10 years), we can plug these values into the formula:

9000 = 12000 × Rate × 10

To solve for the interest rate, divide both sides of the equation by (12000 × 10):

Rate = 9000 / (12000 × 10)

Simplifying this expression, we get:

Rate = 9000 / 120000

Rate = 0.075 or 7.5%

Therefore, Joseph invested his money at an interest rate of 7.5% per annum.