Question

The question is “ you put $350 in an account. the account earns $17.50 simple interest in 2.5 years. what was the annual interest rate.” i dont know if im supposed to divide 17.50 by 2.5 because i got 7 and i was still wrong

Answer 1

Given:

Initial amount = $350

earn simple interest = $17.50

Time = 2.5 year

Find: Annual interest rate is:

Sol:.

`S\mathrm{}I=(P* R* T)/(100)`

Where,

`\begin{gathered} SI=\text{simple interest} \\ P=\text{Initial amount} \\ R=\text{Rate} \\ T=\text{Time} \end{gathered}`
`\begin{gathered} 17.50=(350* R*2.5)/(100) \\ 17.50*100=350* R*2.5 \\ R=(17.50*100)/(350*2.5) \\ R=(1750)/(875) \\ R=2 \end{gathered}`

So interest rate is 2%