Question

find the interest rate of a loan charging $640 simple interest on a principle of $5000 after 4 years.​

Answer 1

Answer:

Interest Rate = 3.2%

Step-by-step explanation:

To find the interest rate of a loan charging $640 simple interest on a principle of $5000 after 4 years, we will follow the steps below;

Write down the formula for finding simple interest

S.I = PRT/100

where

S.I = simple interest

P= principal

R=rate

T=time(in years)

From the question given

S.1=$640

P=$5000

T=4

R=?

We can now proceed to insert our values into the formula and then solve for R

S.I = PRT/100

$640 = $5000×R×4 /100

$640 = $20000R /100

Multiply 100 to both-side of the equation

$640 × 100 = $20000R/100 ×  100

$64000 = $20000R

Divide both-side of the equation by $20000

$64000/$20000 = $20000R/$20000

At the right-hand side of the equation  $20000 will cancel-out each other leaving us with just R

3.2 = R

Rate = 3.2%