April took out a loan of $600 and paid it back with simple interest of $60 after 5 years. The formula to calculate interest is given the principal and the time and the interest rate is . For this problem we have to find the interest rate given . To archive that , we can just solve the equation making the interest rate the subject of the formula as shown below,
I = Prt
=>I/Prt
=> 60 over 600x5 = 1/50
The interest rate is 1/50 or 0.02 as a decimal. The interest rate is 2% as a percentage.