Troy had $7,140 in a savings account with simple interest. He had opened the account with $7,000 exactly 2 years earlier. What was the interest rate?
Use the formula i = prt, where i is the interest earned, p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years.
_____%
To find the interest rate, we will use the formula ( i = prt ).
1. First, we need to determine the interest earned (( i )):
[
i = text{total amount} – text{principal} = 7140 – 7000 = 140
]
2. Next, we can rearrange the formula to solve for ( r ):
[
r = frac{i}{pt}
]
3. Now we can plug in the values:
– ( i = 140 )
– ( p = 7000 )
– ( t = 2 ) years
So,
[
r = frac{140}{7000 times 2}
]
[
r = frac{140}{14000} = 0.01
]
4. To express ( r ) as a percentage, multiply by 100:
[
r times 100 = 0.01 times 100 = 1%
]
Therefore, the interest rate is 1%.