Question

Mateo's sister Paid off her student loans $5000 in 30 years if she made a payment of $152.35 each month what was a simple interest rate for a way around it to the nearest hundred

Answer 1

Answer:

3.23%.

Step-by-step explanation:

Please consider the complete question.

Mateo's sister Paid off her student loans $5000 in 3 years if she made a payment of $152.35 each month what was a simple interest rate for a way around it to the nearest hundred

Let us find total amount paid by Mateo's sister in 3 years.

1 year = 12 months

3 years = 12*3 months = 36 moths.

$\text{Amount paid in 36 months}=36\times \ 152.35$

$\text{Amount paid in 36 months}=\ 5484.6$

Now, we will use simple interest formula to solve our given problem.

$A=P(1+rt)$, where,

A = Total amount after t years.

P = Principal amount,

r = Annual interest rate in decimal form,

$5484.6=5000(1+r(3))$

$\frac{5484.6}{5000}=\frac{5000(1+30r)}{5000}$

$1.09692=1+3r$

$1.09692-1=1-1+3r$

$3r=0.09692$

$r=\frac{0.09692}{3}$

$r=0.032306=3.2306\%\approx 3.23\%$

Therefore, the interest rate was 3.23%.