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16 September, 21:45

The maturity value of a 30-day loan of $650 is $660. What is the annual simple interest rate (in percent) on this loan? Round to the nearest tenth of a percent. Use 360 days in 1 year. (Enter a number.)

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  1. 16 September, 23:59
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    Answer: the interest rate is 18.7%

    Step-by-step explanation:

    The formula for determining simple interest is expressed as

    I = PRT/100

    Where

    I represents interest paid on the loan.

    P represents the principal or amount taken as loan

    R represents interest rate

    T represents the duration of the loan in years.

    From the information given,

    P = 650

    I = 660 - 650 = $10

    T = 30 days. Converting to years,

    T = 30/365 = 0.08219

    10 = (650 * R * 0.08219) / 100 = 0.5342R

    R = 10/0.534 = 18.7% to the nearest tenth of a percent.
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