you deposit $6450 in a savings account. After 4 years, you have earned $1806 in interest, What simple interest rate did your account earn?
To find the simple interest rate, we'll use the formula:
Simple Interest = Principal * Rate * Time
Given:
Principal = $6450
Simple Interest = $1806 (earned after 4 years)
Time = 4 years
Substituting the given values into the formula, we have:
$1806 = $6450 * Rate * 4
Dividing both sides of the equation by ($6450 * 4):
$1806 / $6450 * 4 = Rate
Simplifying:
0.07 = Rate
Therefore, the simple interest rate your account earned is 7%.