Question

Raul deposited $3000 into a bank account that earned simple interest each year. After 3.5 years, he had earned $262.50 in interest.
If no money was deposited into or withdrawn from the account, what was the annual interest rate?

Answer 1

Answer:

2.5% year

Step-by-step explanation:

Simple interest are generally practiced for short period loans, usually for less than one year. Simple interest have linear behavior.

Raul

$I=Prn\Rightarrow 262.5=3000*r*3\frac{1}{2}\Rightarrow \frac{262.5}{3000}=\frac{3000}{3000}*r*3\frac{1}{2}\Rightarrow \frac{7}{80}=3\frac{1}{2}r\Rightarrow r=\frac{7}{80}:3\frac{1}{2}\Rightarrow r=\frac{1}{40}\Rightarrow r=0.025 \: or\:2.5\%$

Answer 2

Simple interest earn
i = Prt

r =i/(Pt)
r = 262.50/(3000 * 3.5)
r = 262.5 / 10,500
r = 0.025

0.025 = 25/1000 = 2.5%

answer: annual interest rate is 2.5%