Suppose that you borrow $10,000 for one year, and at the end of the year, you must repay $10,450. The interest rate is

Question

Quizplus · Accepted Answer

To find the interest rate, we can use the formula:

Interest = Principal x Rate x Time

In this case, the principal is $10,000, the time is 1 year, and the interest is $450. Plugging these values into the formula, we get:

$450 = $10,000 x Rate x 1

Solving for the rate, we get:

Rate = $450/$10,000

Rate = 0.045 or 4.5%

Therefore, the interest rate is 4.5%, which corresponds to choice C.

Suppose That You Borrow $10,000 for One Year, and at the End