Find the simple interest rate.

Karen took out a 30,000, 90 day loan at an annual interest of 8.5%. Find the simple interest rate due on the loan using the ordinary method.

Since the interest rate is at 8.5% PER YEAR, the total amount will receive an interest of 8.5% of 30,000 at the end of the year.

Since she took the loan for 90 days, That will be lower than the 8.5% simple interest per year.

Therefore, by using the simple interest's ordinary method,

You can find out the simple interest rate for 90 days.

Let the simple interest rate for 90 days x.

There are 365 Days in a year.

So write a linear equation using the cross multiplication method first.

365 days = 8.5%
90 days = x%

So, cross multiply the numbers. You'd get:

(8.5 * 90) = (365 * x)

765 = 365x

Therefore,

x = (765/365)

x = 2.1% simple interest for 90 days.

Now, we can find 2.1% of 30,000.

(2.1 * 30,000)/ 100 = 630

Therefore, the interest she owes is 630, at 2.1% for 90 days.

Total amount she would owe to the bank is:

30,000 + 630
= 30,630.

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