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# What simple interest rate will Susan need to secure to make \$2,500 in

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Math Expert
Joined: 02 Sep 2009
Posts: 64096
What simple interest rate will Susan need to secure to make \$2,500 in  [#permalink]

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29 Jul 2019, 05:09
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Question Stats:

94% (00:42) correct 6% (00:54) wrong based on 33 sessions

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What simple interest rate will Susan need to secure to make \$2,500 in interest on a \$10,000 principal over 5 years?

A. 4%
B. 5%
C. 6%
D. 7%
E. 8%

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Re: What simple interest rate will Susan need to secure to make \$2,500 in  [#permalink]

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29 Jul 2019, 08:19
Bunuel wrote:
What simple interest rate will Susan need to secure to make \$2,500 in interest on a \$10,000 principal over 5 years?

A. 4%
B. 5%
C. 6%
D. 7%
E. 8%

2500/5 is 500 per year. Since it is simple interest, to earn 500 is basically 5% of 10,000. (10% is 1000 so 5% is 500). IMO B
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What simple interest rate will Susan need to secure to make \$2,500 in  [#permalink]

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29 Jul 2019, 08:28
1
Bunuel wrote:
What simple interest rate will Susan need to secure to make \$2,500 in interest on a \$10,000 principal over 5 years?

A. 4%
B. 5%
C. 6%
D. 7%
E. 8%

Principle = \$10,000
Interest per annum = \$2500/5 = \$500
Simple Interest rate = 500/10000 = 5%

IMO B
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Re: What simple interest rate will Susan need to secure to make \$2,500 in  [#permalink]

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29 Jul 2019, 08:29
1
I = P*R*T

P = 10,000
T = 5 years
I = 2500

R=I/P*T
R=2500/(10000*5) = 2500/50000 = 0.05 = 5%

Hence, B is the correct answer
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Re: What simple interest rate will Susan need to secure to make \$2,500 in  [#permalink]

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06 Aug 2019, 16:57
Bunuel wrote:
What simple interest rate will Susan need to secure to make \$2,500 in interest on a \$10,000 principal over 5 years?

A. 4%
B. 5%
C. 6%
D. 7%
E. 8%

Using the simple interest formula, Interest = Principal x Rate x Time, and letting n = the interest rate, we can create the equation:

2,500 = 10,000 x n/100 x 5

500/10000 = n/100

5/100 = n/100

n = 5

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Re: What simple interest rate will Susan need to secure to make \$2,500 in   [#permalink] 06 Aug 2019, 16:57