treasury bills (t-bills) can be purchased from the U. S. Treasury department. You buy a t-bill for 981.60 that pays 1,000$ in 13 weeks. What simple interest rate, to the nearest tenth of a percent, does this t-bill earn

Question

Bria Shea

Mathematics

2 January, 08:12

treasury bills (t-bills) can be purchased from the U. S. Treasury department. You buy a t-bill for 981.60 that pays 1,000$ in 13 weeks. What simple interest rate, to the nearest tenth of a percent, does this t-bill earn

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Answers (1)

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Hobbs · Answer 1

Answer:The simple interest rate is 7.50%

Step-by-step explanation:

Simple interest, I = (P * T * R) / 100

Where P = Principal investment

T = Time in years

R = rate

Given

P = 981.60

I = 1000 - 981.60 = 18.40

T = 13 weeks = 13 / 52 = 0.25 year

I = (P * T * R) / 100

Cross multiply

I * 100 = P * T * R

18.40 * 100 = 981.60 * 0.25 * R

1840 = 245.4 R

R = 1840 / 245.4

R = 7.498%

To the nearest tenth

R = 7.50%