Use the Simple Interest Formula to Determine the Missing Value

question 146

Multiple Choice

Use the simple interest formula to determine the missing value. Round dollar amounts to the nearest cent and percents to the nearest hundredth when necessary
-p = $6205, r = ?, t = 5 months, i = $90.49

• A) r = 3.5%
• B) r = 1.4%
• C) r = 0.04%
• D) r = 28.57%

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Definitions:

Income Elasticity

A measure of how much the demand for a good or service changes in response to a change in consumers' income levels.

Normal Good

A good for which demand increases as consumer income rises, and decreases as consumer income falls.

Inferior Good

A type of good for which demand decreases as the income of the consumer increases, as opposed to a normal good where demand increases with income.

Linear Demand Curve

A demand curve that shows a straight-line relationship between price and quantity demanded, suggesting a constant rate of change.