Question

$10 earns $0.40 in interest. what is the percent interest?

Explanation:

Step1: Recall Interest Rate Formula

The formula for simple interest rate is $r=\frac{I}{P}$, where $I$ is interest, $P$ is principal. Here, $I = 0.40$, $P = 10$.

Step2: Calculate Rate

Substitute values: $r=\frac{0.40}{10}=0.04$. Convert to percent: $0.04\times100 = 4\%$.

Answer:

The percent interest is $4\%$.