Interest of $429.48 was charged on a loan of $9500 over a period of 7 months. What simple rate of interest was charged on the loan?
A) 4.52%
B) 2.64%
C) 7.75%
D) 3.48%
E) 4.38%

Question

Quizplus · Accepted Answer

We can use the formula:

Simple Interest = (Principal x Rate x Time)/100

where Principal = $9500, Time = 7 months and Simple Interest = $429.48

Substituting the values, we get:

$429.48 = (9500 x Rate x 7)/100

Solving for Rate, we get:

Rate = ($429.48 x 100)/(9500 x 7) = 7.75%

Therefore, the simple rate of interest charged on the loan is 7.75%. Hence, the correct option is C.