What is the interest rate if a principal of $700 earns $196.00 in interest in seven years?
1 answer:
Answer:
4%
Step-by-step explanation:
To solve this problem we can use a modified version of the simple interest formula which is shown below:
<em>P = initial balance</em>
<em>I = interest</em>
<em>t = time</em>
<em />
Plug the values into the equation:
The last step is to convert 0.04 into a percent:
0.04(100) = 4
The interest rate is 4%.
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