Question

fernando had $721 in a savings account with simple interest. he had opened the account with $700 just 6 months earlier. what was the interest rate? use the formula $i = prt$, where $i$ is the interest earned, $p$ is the principal (starting amount), $r$ is the interest rate expressed as a decimal, and $t$ is the time in years.

Explanation:

Step1: Find the interest earned (i)

The principal (p) is $700, and the final amount is $721. So the interest earned \( i = 721 - 700 = 21 \).

Step2: Convert time to years

The time (t) is 6 months. Since 1 year has 12 months, \( t=\frac{6}{12}=0.5 \) years.

Step3: Solve for the interest rate (r) using \( i = prt \)

We know \( i = 21 \), \( p = 700 \), and \( t = 0.5 \). Substitute these values into the formula:
\( 21 = 700\times r\times0.5 \)
First, simplify the right - hand side: \( 700\times0.5 = 350 \), so the equation becomes \( 21 = 350r \)
Then, solve for r by dividing both sides by 350: \( r=\frac{21}{350}=0.06 \)
To convert r to a percentage, multiply by 100: \( 0.06\times100 = 6\% \)

Answer:

6