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How to Calculate Simple Interest on the ACT11/28/2016 Question:A formula for calculating simple interest is I = Pr, were I is the interest earned in dollars, P is the principal or original investment, and r is the fixed rate of interest. If the amount of interest earned is $2.25 and the interest rate is 3%, what is P? F. $6.75 G. $7.50 H. $13.30 J. $67.50 K. $75.00 Answer:The correct answer is K.
You are given two of the three unknowns; plug I = 2.25 and r = 0.03 (the decimal equivalent of 3%) into the formula I = Pr: 2.25 = P(0.03) Solve for P: P = 75
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