simple interest rate

Question

hailey earned $75 in simple interest for depositing $500 in a savings account and leaving it there for 5 years. What was the simple interest rate for he savings account?

Answer 1

to find the simple interest rate you want to use the formula

R = I/PT

for this set of values that means taking

R = 75 / (500 *5) = 0.03 x 100% = 3%

meaning that the simple interest rate for Hailey's savings account was 3.0%

Answer 2

500( 1 + 5r) = 575

 

 500 + 2500 r = 575

 

    2500 r = 75

 

    r = 75/2500 = 0.03= 3%