At a 7% interest rate did he borrow the money.
Given that,
Mr. Johnson borrowed $8000 for 4 years to make home improvements.
If he repaid a total of $10,320.
We have to determine,
At what interest rate did he borrow the money?
According to the question,
The total amount he borrowed = $8000
Time period = 4 years
Repaid amount = $10,320
Left amount = Repaid amount - borrowed amount
Left amount = 10,320 - 8000
Left amount = 2320
Therefore,
The interest rate did he borrow the money is given by the following formula;
[tex]\rmLeft \ amount= Principal \times Rate \times Time\\\\2320 = 8000 \times 4 \times Rate\\\\Rate = \dfrac{2320}{32000}\\\\Rate = 0.07[/tex]
Converting into a percentage by multiply by 100,
[tex]\rm Rate = 0.07\times 100\\\\Rate = 7 \ percent[/tex]
Hence, At a 7% interest rate did he borrow the money.
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