Question

The simple interest formula is I=Prt, where I represents interest, P represents principal, r represents rate, and t represents time in years. Determine the principal given the interest of $10, with an interest rate of 8% for 2 years.

Answer 1

$p = \frac{i}{rt}$
$p = \frac{10}{(.08)(2)}$
$\frac{10}{.16}$
$\frac{10}{.16} = 62.50$