Chapter 6.6, Problem 10IP

To determine

To find: Simple interest.

Answer to Problem 10IP

Simple interest $=I=\$82.5$

Explanation of Solution

Given information:

Principal amount $=\$275$

Time $=4$ years.

Interest percent $=7.5\%$

Concept:

  $I=prt$

Where

  $I=$ Simple interest.

  $p=$ Principal amount

  $t=$ time in years.

  $r=$ Annual interest rate.

Calculation:

From given information

Principal amount $=p=\$275$

Time $=t=4$ years.

Interest percent $=R=7.5\%$

We know

Annual interest rate $=r=\frac{R}{100}$

  $\begin{array}{l}\Rightarrow r=\frac{7.5}{100}\\ \Rightarrow r=0.075\end{array}$

On substituting values in above mentioned concept

We get

  $\begin{array}{l}I=prt\\ \Rightarrow I=\left(275\right)\left(0.075\right)\left(4\right)\\ \Rightarrow I=\$82.5\end{array}$

Therefore,

To the nearest cent, Simple interest $=I=\$82.5$