SOLUTION: If you owe $30,000 for a loan and your interest payment is $125 per month. What is the annual interest rate?

Question 486520: If you owe $30,000 for a loan and your interest payment is $125 per month. What is the annual interest rate?

Found 2 solutions by stclair.alex151, MathTherapy:
Answer by stclair.alex151(1) (Show Source): You can put this solution on YOUR website!
well, you must first put this into numbers, as you would for any word problem. 125/month times 12 (months in a year) 125x12=>>>1500<<< i hope i helped, and unless i read it wrong, that is the answer to your problem.
Answer by MathTherapy(10552) (Show Source): You can put this solution on YOUR website!
If you owe $30,000 for a loan and your interest payment is $125 per month. What is the annual interest rate?

Since the interest is $125 per month, then amount of interest paid per year is: 125 * 12 months = $1,500 per year

Simple interest = PTR, where P = principal, T = time, and R = rate (interest)

1,500 = $30,000 * 1 * R

1,500 = 30,000R

R, or rate of interest = = , or .05, or %.
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