A man earns $112 interest in one year on an investment of $1,400. What was his rate of interest?

1 Answer
Oct 23, 2016

Answer:

R = $112 / $1400 which solves to a rate of 0.08 or multiplying it by 100 to make a percentage 8%.

Explanation:

Assuming no compound interest:

I = R * P; Where
I = Interest Earned
R = Rate of Interest
P = Principle Invested

In this question we know I (Interest Earned) and P (Principle Invested) therefore:

$112 = R * $1400

Solving for R gives you:

R = $112 / $1400 which solves to a rate of 0.08 or multiplying it by 100 to make a percentage 8%.