Question

What percentage interest rate is a loan that charges $100 in simple annual interest over 5 years on a $1000 balance?

A.) 20%
B.) 0.24%
C.) 2%
D.) 24%

Answer 1

What formula are you learning?

Answer 2

I = P r t ?

Answer 3

I don't remember seeing one? In my lesson

Answer 4

What topic are you learning?

Answer 5

Simple Intrest

Answer 6

Interest*

Answer 7

So that's the right one!

Answer 8

Sorry :( I didn't remember seeing one

Answer 9

I guess they write:
FV = P * r * t

Answer 10

Well, no matter what term, the idea of simple interest is the same:
Interest rate r = Interest I / Principal P * time t
= $ 100 / $ 1,000 * 5 yrs = 2%

Answer 11

Thank you so much!