Question

Solve a word problem involving simple interest

Question
David borrowed $30,000 to start a business. Four years later, he repaid the $30,000 along with an interest of $1,260. What
was the annual interest rate? Round to two decimal places.

Answer 1

1.05% do I need to show work?

Answer 2

Answer: 1.05%

Explanation:

Principal= $30000

Time= 4 years

Rate= Unknown

Interest= 1260

Simple interest= PRT/100

1260= (30000×R×4)/100

Cross multiply

1260×100= 120000R

126000=120000R

Divide both side by 120000

R= 126000/120000

R= 1.05%