If I put $500 into an account and left it alone for three years earning simple interest, and at the end of three years I withdrew $650, what interest rate was I earning? Can you explain how you got your answer so i can understand what to do.

APatel Feb 18, 2020

#1**+1 **

$650 - $500 =$150 simple interest earned over 3 years.

$150 / 3 =$50 simple interest earned in 1 year.

$50 / $500 = 10 % simple interest rate per year.

Guest Feb 18, 2020

#3**+2 **

Interst amount earned must have been 650 - 500 = $150

And I = Prt

Where I = interest P = original amount r =interest rate t = time in years

So

150 = 500 * r * (3)

150 = 1500 * r divide both sides by 1500

150 /1500 = 1/10 = r = .10 = 10% = interest rate

This makes sense.....the interst earned each year = .10 * 500 = $50

So...at the end of 3 years....we have 3 * 50 = $150 more than what we originally deposited

CPhill Feb 18, 2020

#7**+1 **

**If I put $500 into an account and left it alone for three years earning simple interest, and at the end of three years I withdrew $650, what interest rate was I earning? Can you explain how you got your answer so i can understand what to do.**

**Simple interest formula is: A = P ( 1 + rt )**

**A - final amount 650 = 500 ( 1 + r * 3 ) /500**

**P - principal 650/500 = 1 + 3r **

**r - interest rate 1.3 = 1 + 3r**

**t - time ( in years) 3r = 0.3**

** ****r = 0.1 ( 10% ) **

Dragan Feb 19, 2020