Steve Marino borrowed $500 from his credit union for 2 years. The simple that he paid was $52.90. What simple interest rate was Jeff charged?
Take the simple interest formula
I = PxRxT and solve it for R to get
R = I/(PT)
= 52.9/(500x2)
= .0529 or 5.29%
THANK YOU!
To find the simple interest rate charged to Steve Marino, we need to use the formula for simple interest:
Simple Interest = Principal × Rate × Time
Here, the principal is the amount Steve borrowed, which is $500, and the time is 2 years. The question states that Steve paid $52.90 in simple interest. Plugging in these values in the formula, we can solve for the rate.
52.90 = 500 × Rate × 2
Now, divide both sides of the equation by (500 × 2) to isolate the rate:
Rate = 52.90 / (500 × 2)
Rate ≈ 0.0529
So, the simple interest rate charged to Steve Marino is approximately 0.0529 or 5.29%.