Question

Rex took out a loan for $5000 and planned to pay it back in 4 years. If he paid $600 in interest for those 4 years, what was the simple interest rate?.

Answer 1

$~~~~~~ \textit{Simple Interest Earned} \\\\ I = Prt\qquad \begin{cases} I=\textit{interest earned}\dotfill & \ 600\\ P=\textit{original amount deposited}\dotfill & \ 5000\\ r=rate\to r\%\to \frac{r}{100}\\ t=years\dotfill &4 \end{cases} \\\\\\ 600=5000(\frac{r}{100})(4)\implies \cfrac{600}{5000(4)}=\cfrac{r}{100}\implies \cfrac{3}{100}=\cfrac{r}{100}\implies \boxed{3=r}$