Answer :
The interest rate is 8 % if your balance on an investment of 857 dollars at the end of six years is 1268.36 dollars
Solution:
Given that,
Principal = $ 857
Amount = $ 1268.36
Number of years = 6
Rate of interest = ?
Simple Interest = Amount - principal
Simple Interest = 1268.36 - 857
Simple Interest = 411.36
Use the formula,
[tex]Simple Interest = \frac{ p \times n \times r}{100}\\\\411.36 = \frac{ 857 \times 6 \times r}{100}\\\\41136 = 5142 \times r\\\\r = \frac{41136}{5142}\\\\r = 8 \%[/tex]
Thus the interest rate is 8 %
The interest rate is 8%.
Step-by-step explanation :
From the given data, it can be determined that
The invested amount is 857 dollars.
⇒ Principal, P= $857
The number of years is six years ⇒ n = 6
It is given that, the amount at the end of 6 years is 1268.36 dollars.
⇒ Amount = $1268.36
To find the interest :
Amount = Principal + Interest.
⇒ Interest = Amount - Principal
⇒ 1268.36 - 857
⇒ 411.36
The Interest is $411.36
To find the rate of interest (r) :
The formula for simple interest is given by,
Simple interest = Pnr /100
where,
P is the Principal , n is the number of years, r is the interest rate
⇒ 411.36 = (857× 6× r) /100
⇒ 411.36 × 100 = 5142 × r
⇒ 41136 = 5142 × r
⇒ r = 41136 / 5142
⇒ r = 8 %
Therefore, the interest rate is 8%.