If a business borrows $12,600 and repays $23,940 in 5 years, what is the simple interest rate? ​

Question

If a business borrows $12,600 and repays $23,940 in 5 years, what is the simple interest rate? ​

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Euphemia 6 months 2021-07-26T12:58:36+00:00 1 Answers 4 views 0

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    2021-07-26T13:00:35+00:00

    Answer:

    18%

    General Formulas and Concepts:

    Pre-Algebra

    Order of Operations: BPEMDAS

    1. Brackets
    2. Parenthesis
    3. Exponents
    4. Multiplication
    5. Division
    6. Addition
    7. Subtraction
    • Left to Right  

    Equality Properties

    • Multiplication Property of Equality
    • Division Property of Equality
    • Addition Property of Equality
    • Subtraction Property of Equality

    Algebra I

    Simple Interest Rate Formula: A = P(1 + rt)

    • P is principle amount
    • r is rate
    • t is time

    Step-by-step explanation:

    Step 1: Define

    Identify variables

    P = 12600

    A = 23940

    t = 5

    Step 2: Solve for r

    1. Substitute in variables [Simple Interest Rate Formula]:                                 23940 = 12600(1 + 5r)
    2. [Division Property of Equality] Divide 12600 on both sides:                         19/10 = 1 + 5r
    3. [Subtraction Property of Equality] Subtract 1 on both sides:                         9/10 = 5r
    4. [Division Property of Equality] Divide 5 on both sides:                                  9/50 = r
    5. Rewrite:                                                                                                             r = 9/50
    6. Evaluate:                                                                                                           r = 0.18
    7. Convert:                                                                                                            r = 18%

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