Question

april took out a $600 loan from the bank. at the end of 5 years, she pays back the principal, plus $60 simple interest. what was the interest rate? enter your answer in the box. %

Explanation:

Step1: Recall simple interest formula

The formula for simple interest is $I = P \times r \times t$, where $I$ is the interest, $P$ is the principal amount, $r$ is the annual interest rate (in decimal), and $t$ is the time in years.

Step2: Identify known values

We know that $I = 60$, $P = 600$, and $t = 5$. We need to solve for $r$.

Step3: Substitute values into the formula

Substitute the known values into the formula: $60 = 600 \times r \times 5$.

Step4: Simplify and solve for r

First, simplify the right - hand side: $600\times5 = 3000$, so the equation becomes $60 = 3000r$. Then, divide both sides by 3000: $r=\frac{60}{3000}=0.02$.

Step5: Convert decimal to percentage

To convert the decimal rate to a percentage, multiply by 100. So $r = 0.02\times100 = 2\%$.

Answer:

2