Question

benson purchased a 1,800 certificate of deposit that earns simple annual interest. At the end of 1 year the certificate was worth 1,857.60 what is the annual interest rate on this certificate of deposit

Answer 1

Answer:

3.2%

Step-by-step explanation:

-Let r be the simple interest rate per annum.

-Given the total amount after 1 year is 1857.60, the initial amount is 1800

#We use the simple interest formula to find the rate of interest:

$Interest=Final\ Amount-Initial\ Amount\\\\=1857.60-1800\\\\=57.60\\\\I=Prt\\\\57.60=1800\times r\times 1\\\\r=\frac{57.60}{1800}\\\\=0.032\\\\=3.2\%$

Hence, the annual interest rate on the deposit is 3.2%