Question

Lily took out a 5-year loan from the bank for $31,000 to purchase a new car. At the end of the loan, she had paid a total of $37,975. Find the interest rate on the loan.

Answer 1

Answer:

=24.5%

Step-by-step explanation:

1. Simple interest = (principal×rate×time)÷100. *brackets first*
2. transpose the formula to make rate the subject: rate= (100×simple interest) ÷ (principal×time)
3. plug in values: rate = (100×37975) ÷ (31000×5)
4. the result is 24.5%