Which equation shows the interest rate that Tran is paying? Tran got a loan of $10,000 from the bank to help pay for his new car. He agreed to pay $800 in interest for the use of this money.
Answer
A
10 comma 000 minus 800 is equal to 9 comma 200
B
10 comma 000 divided by 800 is equal to 12 point 5
C
10 comma 000 plus 800 is equal to 10 comma 800
D
800 divided by 10 comma 000 is equal to point 0 8
Explanation
The interest rate is the interest paid divided by the amount borrowed. Tran paid $800 in interest on a $10,000 loan, so the equation is 800 ÷ 10,000 = 0.08. This means Tran is paying an 8% interest rate.
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