<PRE><B>Question 585410</B>
The interest paid is $27000 - $20000 = $7000



Now plug this into the formula I = Prt along with P = 20000 and t = 6 and solve for r:


I = Prt


7000 = 20000r(6)


7000 = 120000r


7000/120000 = r


0.05833333333333 = r


r = 0.05833333333333


r = 0.05833



So the interest rate is roughly 5.8333% (which is 5 and 5/6%)</PRE>