The average interest rate is 8.57% paid on the total of $28,000
The percentage is defined as a ratio expressed as a fraction of 100.
Dominic pays 7% interest on his $16,000 college loan,
And 12% interest on his $12,000 car loan
To determine the average interest rate paid on the total $28,000 he owes
Calculating the total interest amount paid :
⇒ 7% of 16,000 + 12% of 12,000
⇒ (7/100)16,000 + (12/100)12,000
⇒ (0.07)16,000 + (0.12)12,000
⇒ (0.07)16,000 + (0.12)12,000
⇒ 960 + 1440
⇒ 2400
So the average interest rate paid on the total of $28,000 as
⇒ 2400/28,000 = 0.0857 ≈ 8.57%
Hence, the average interest rate is 8.57% paid on the total of $28,000
Learn more about the percentage here:
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