Elementary Algebra

Published by Cengage Learning
ISBN 10: 1285194055
ISBN 13: 978-1-28519-405-9

Chapter 4 - Proportions, Percents, and Solving Inequalities - Chapter 4 Review Problem Set: 40

Answer

The annual interest rate is 4%.

Work Step by Step

The interest formula is: i = P $\times$ r $\times$ t. To find the annual interest rate, or r, we divide i by P $\times$ t So, r = $\frac{i}{P\ \times\ t}$ P = 7500 i = 1200 t = 4 Substitute these values into the formula to obtain the annual interest rate. r = $\frac{1200}{7500\times4}$ r = $\frac{1200}{30000}$ r = 0.04 We multiply .04 by 100% to convert it to a percent. r = 0.04 $\times$ 100% = 4% The annual interest rate is 4%.
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