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In the previous question, we determined that if you borrow $3,000 on an 8% discounted loan for 9 months, the amount you actually receive will be $2,820. Given this, what is the effective interest rate on the loan you receive? Express your answer as a percentage rounded to the nearest tenth of a percent if necessary,

Respuesta :

We can use the formula

[tex]I=\text{Prt}[/tex]

again to solve this problem.

We had

I = $180

P = $3000

r = effective interest rate (we need to find)

t = 0.75 years

Substituting, we get;

[tex]\begin{gathered} I=\text{Prt} \\ 180=3000r(0.75) \\ r=\frac{180}{3000(0.75)} \\ r=0.045 \end{gathered}[/tex]

Converted to a percentage, we have:

[tex]r=0.045\times100=4.5\%[/tex]

Answer4.5%

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