Question

Jake received a student loan for $12,000. He plans on paying off the loan in five years. At the end of five years, J. Cole have paid $3600 in interest. What is a simple interest rate on the student loan?

Answer 1

Answer=6%

Explanation:

Principal(P)=12000

Time(T)=5 yrs

Interest(I)=3600

We have,

I=PTR/100

3600=(12000*5*R)/100

3600*100=60000*R

R=360000/60000

R=6%

Answer 2

The simple interest rate on the student loan is 6%.

Explanation:

To solve for the simple interest rate, use the formula for total simple interest:

`I = Prt`

`I` = total interest paid

P = principal, or starting value

r = interest rate in decimal form

t = time in years

State known values

P = 12,000

t = 5

`I` = 3,600

Substitute known values and isolate "r"

`I = Prt`

3,600 = (12,000) (r) (5)

3,600 = (60,000) r

r = 0.06

Since "r" is given as a decimal, convert this to a percentage by multiplying by 100.

0.06 = 6%

∴ The simple interest rate on the student loan is 6%.