The amount required to settle a $680 debt after 300 days was $730.30. What rate of interest was charged on the debt?
I = PRT
50.30 = 680 * R * 0.822
50.3 / 558.9 = R
0.09 = R
To determine the rate of interest charged on the debt, we can use the formula for simple interest:
Simple Interest = Principal (P) * Rate (R) * Time (T)
Given information:
Principal (P) = $680
Amount after time (A) = $730.30
Time (T) = 300 days
We can rearrange the formula to solve for the rate (R):
Rate (R) = (Amount after time / Principal) / Time
Plugging in the values:
Rate (R) = ($730.30 / $680) / 300
Simplifying:
Rate (R) = 1.074 / 300
Calculating the rate:
Rate (R) = 0.00358 or 0.358%
Therefore, the rate of interest charged on the debt is 0.358%.
To find the rate of interest charged on the debt, we can use the formula for simple interest:
I = P * r * t
Where:
I = Interest
P = Principal amount (initial debt)
r = Rate of interest
t = Time (in years)
In this case, the principal amount is $680, and the time is 300 days. We need to convert the time from days to years by dividing it by 365:
t = 300 days / 365 days/year = 0.8219 years
Now, let's plug in the values we have into the formula and solve for the interest:
$730.30 = $680 * r * 0.8219
To isolate the rate of interest (r), divide both sides of the equation by ($680 * 0.8219):
r = $730.30 / ($680 * 0.8219)
Using a calculator, we find that:
r ≈ 0.1409
So, the interest rate charged on the debt is approximately 14.09%.