Question

Find annual interest rate I = $18, P= 200 t = 18 months

Answer 1

`Annual\: rate=\: 6\%\: or\: 0.06`

1) Since we have only this information, we can make use of the interest formula:

`I=Prt`

Note that we're going to find the rate per year, so we need to make a little adjustment since the period has been given in months:

`(18)/(12)=1.5`

2) Now, we can plug the data into the formula:

`\begin{gathered} I=Prt \\ 18=200r1.5 \\ 18=300r \\ 300r=18 \\ (300r)/(300)=(18)/(300) \\ r=0.06 \end{gathered}`

So, the annual rate is 6%