Question

Mr mojo borrowed $9000 for 10 years to make home improvements. If he repaid a total of $20000 at what interest rate did he borrownthe money

Answer 1

The rate of interest is 12.2 %

Solution:

Given that, Mr mojo borrowed $9000 for 10 years to make home improvements

He repaid a total of $ 20000

To find: Rate of interest

We can use simple interest formula to calculate the rate of interest

Total amount = Principal + simple interest

20000 = 9000 + simple interest

Simple interest = 20000 - 9000

Simple interest = 11000

The simple interest is given as:

$I = \frac{ p \times r \times t}{100}$

Where,

"I" is the simple interest

"p" is the principal

"r" is the rate of interest

"t" is the number of years

Substituting the values,

$11000 = \frac{9000 \times r \times 10}{100}\\\\11000 = 900 \times r\\\\r = \frac{11000}{900} = 12.2$

Thus rate of interest is 12.2 %