What is the interest rate when you borrow \( \$ 600 \) for 1 year and pay \( \$ 45.00 \) interest?

To find the interest rate, you can use the formula: \[ \text{Interest Rate} = \frac{\text{Interest Paid}}{\text{Principal}} \times 100 \] In this case, you paid \( \$ 45.00 \) in interest on a principal of \( \$ 600 \). Plugging the numbers into the formula gives: \[ \text{Interest Rate} = \frac{45}{600} \times 100 = 7.5\% \] So, the interest rate for borrowing \( \$ 600 \) for 1 year and paying \( \$ 45.00 \) in interest is \( 7.5\% \). When borrowing money, it's essential to understand how interest rates can impact your overall repayment. Higher interest rates mean you’ll pay more over time, so always compare rates before committing. This awareness can save you money! If you're curious about personal finance and loans, many resources explore budgeting and interest calculations that can deepen your understanding. Books like "The Total Money Makeover" by Dave Ramsey are excellent for financial mindset shifts. Or check out online courses for a more interactive approach!