Asked by sarah

Loan Amount: $15,000

Method of payment: discount basis

Amount of Interest : $650

Term of loan: 1 year

Effective Rate of Interest (to the nearest tenth):
I tried to work this out but I got it completely WRONG !!

Answers

Answered by Ms. Sue
Interest = principal * rate * time

650 = 15,000 * r * 1

650 = 15,000r

650/15,000 = r

0.04333 = 4.3% = r

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