What is the rate of interest on a note for $3,600, due in 180 days, if the total interest to be paid is $400?

Question

Quizplus · Accepted Answer

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

Interest = Principal x Rate x Time

Where Principal = $3,600, Time = 180/365 = 0.4932 years (approx), and Interest = $400.

Plugging in the values, we get:

$400 = $3,600 x Rate x 0.4932

Rate = $400 / ($3,600 x 0.4932)
Rate = 0.2261

Multiplying by 100, we get the rate as 22.61%, which can be rounded to 22%. Therefore, the best choice is C.

What Is the Rate of Interest on a Note for $3,600