Question

Question 1 of 10 Diana invested $3000 in a savings account for 3 years. She earned $450 in interest over that time period. What interest rate did she earn? Use the formula I=Prt to find your answer, where I is interest, P is principal, r is rate and t is time. Enter your solution in decimal form rounded to the nearest hundredth. For example, if your solution is 12%, you would enter 0.12

Answer 1

Hey there!!

The question states that a sum is invested which is $3000 and hence, this would be counted as the principle amount or the principle sum.

The term given is 3 years, which gives us the idea that this interest is being counted or being active for 3 years.

She ( Diana ) earned the sum $450 at the end of three years. This means, the simple interest is $450.

Never get confused with the principle amount, principle sum and interest.

Principle amount = Principle sum + The interest.

Formula given :

I = prt

'p' is denoted as the principle sum, r is the rate and the t is the term or the number of years.

Now, plugging in all the values :

... 450 = 3000×r×3

... 450 = 9000×r

... r = 450 / 9000

... r = 0.05

... r = 5%

As we need the answer in the decimal form, the answer would be 0.05

Hope my answer helps!!