Calculate interest

Question

P=? R = 8% ,T=month, I =$84 ROUND TO NEAREST CENT

P=$1, 500,R=?T=2years , I $ 138 r = ROUND TO ONEDECIMAL AS NEEDED

Principal 2,000 rate 3 ½ % time 3 month Interest is$ round to the nearest cent

 

Answer 1

The formula for simple interest is:

 

     I = P·R·T

 

Since R is the interest rate per year, we must convert the time (T) to years.  We must also convert the rate to decimal.  For I = $84, R = 8% = 0.08, T = 3 months = 3/12 = 0.25 year:

 

     $84 = P·(0.08)·(0.25)

     $84 = P·(0.02)

     $84/(0.02) = P

     $4200 = P

 

For P = $1500, I = $138, T = 2 years:

 

     $138 - ($1500)·R·(2 years)

     $138 = $3000·R

 

Solve for R.  R will be in decimal form.  To convert to %, multiply by 100%.