Question

Natalie earned $200 in interest and 30 months with a beginning balance of $1040. What was her interest rate?

Answer 1

The interest rate is 7.69%

Step-by-step explanation:

Given

Interest = $200

Time = t = 30 months

Time will be converted into years as the rate is applied yearly

So,

1 year = 12 months

30 months = 30/12 years = 2.5 years

Principal amount  = $1040

The formula for interest is:

$I = P*r*t$

Putting the values

$200 = 1040 * r * 2.5\\200 = 2600r\\r = \frac{200}{2600}\\r = 0.076923$

Converting into percentage:

r = 7.6923

Rounding off to nearest hundredth

r = 7.69%

Hence,

The interest rate is 7.69%

Keywords: Interest, percentage

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