What was the interest rate if your balance on an investment of 857 dollars at the end of six years is 1268.36 dollars

Solution:

Given that,

Principal = $ 857

Amount = $ 1268.36

Number of years = 6

Rate of interest = ?

Simple Interest = Amount - principal

Simple Interest = 1268.36 - 857

Simple Interest = 411.36

Use the formula,

Thus the interest rate is 8 %

The interest rate is 8%.

Step-by-step explanation :

From the given data, it can be determined that

The invested amount is 857 dollars.

⇒ Principal, P= $857

The number of years is six years ⇒ n = 6

It is given that, the amount at the end of 6 years is 1268.36 dollars.

⇒ Amount = $1268.36

To find the interest :

Amount = Principal + Interest.

⇒ Interest = Amount - Principal

⇒ 1268.36 - 857

⇒ 411.36

The Interest is $411.36

To find the rate of interest (r) :

The formula for simple interest is given by,

Simple interest = Pnr /100

where,

P is the Principal , n is the number of years, r is the interest rate

⇒ 411.36 = (857× 6× r) /100

⇒ 411.36 × 100 = 5142 × r

⇒ 41136 = 5142 × r

⇒ r = 41136 / 5142

⇒ r = 8 %

Therefore, the interest rate is 8%.

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