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Popular Word Problems >

Sam borrowed 4, 500 for 2 years and had to pay 630 simple interest at the end of that time. What rate of interest did he pay?

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Solution

Samborrowed4,500for2yearsandhadtopay630simpleinterestattheendofthattime.Whatrateofinterestdidhepay?

Solution

Rate:7%
Solution steps
Translate the problem into an equation:630=4500r⋅2
Solve for r,630=4500r⋅2:r=7%
Rate:7%

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