The annual interest rate is 7.5%
Step-by-step explanation:
Given : i=$562.50, p=$1500, t=5 years
We have to calculate the annual interest rate.
We know
Interest = Principal × rate × time
Given : Interest = $562.50
Principal = $1500
Time = 5 years.
Substitute, we get,
562.50 = 1500 × rate × 5
⇒
Thus, rate = 0.075 = 0.075 × 100 = 7.5%
Thus, the annual interest rate is 7.5%
