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Reese deposited $7500 for two years into a money market account. At the end of two years, she earned $1200 interest. What rate of interest did she receive? a. 796 b. 7.5% C. 8%
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Reese deposited $7500 for two years into a money market account. At the end of two years, she earned $1200 interest. What rate of interest did she receive? a. 796 b. 7.5% C. 8%

User Denis Frezzato
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1 Answer

4 votes

The interest formula is


I=\frac{\text{PRT}}{100}

Thus


\begin{gathered} R=(100I)/(PT) \\ =(100*1200)/(7500*2) \\ =8 \end{gathered}

Thus the interest rate was 8% per annum

User KarstenF
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