You borrowed $25 from your friend. You paid him back in full after 6 months. He charged $2 for interest. What was the annual simple interest rate that he charged you? Use the formula: I = Prt.
the money you borrow = 25 dollars. HE charged you 2% interest for 6 months => in 12 months = 2% interest 25 dollars * .02 = 0.5 dollars for 6 months. => 25 + 0.5 = 25.50 dollars for 1 year => 25 * 0.04 =1 dollar => 26 dollars in a year
