Question

Find the annual interest rate. I = $18 P = 200 T = 18 months

Answer 1

Given:

The interest amount is I = $18.

The principal amount is P = $200.

The number of years is T = 18 months.

The objective is to find the annual interest rate (R).

Step-by-step explanation:

The general formula to find the interest rate is,

`\begin{gathered} I=(P* R* T)/(100) \\ R=(I*100)/(P* T)\text{ . . . . . . . (1)} \end{gathered}`

The value of T in years can be written as,

`T=(18)/(12)`

On plugging the obtained values in equation (1),

`R=(18*100)/(200*(18)/(12))`

On further solving the above equation,

`\begin{gathered} R=(18*100*12)/(200*18) \\ =(12)/(2) \\ =6\text{ \%} \end{gathered}`

Hence, the annual interest rate is 6%.Hence, the annual interest rate is 6%.Hence, the annual interest rate is 6%.