## Related questions with answers

Question

Bill Rich signed a 180-day note for $1,250. He repaid the loan when due with interest at an annual rate of 12 % using a banker's year.

Kelly Bullock borrowed$4,800 for 6 months and paid $264 interest. What rate of interest did she pay?

Solution

VerifiedStep 1

1 of 2$\text{Interest} = \$4,800 \times \text{Rate} \times 0.5\\\\ \$264 = \$2,400 \times \text{Rate}\\\\ \text{Rate} = \dfrac{\$264}{\$2,400}\\\\ = 0.11 = 11\%$

Interest = Principal x Rate x Time

Where rate is in decimals and time is in years

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