Answer: To find the interest rate, we can use the formula:
Interest = Principal * Rate * Time
Given that Omar paid $488 in interest on a $20,000 loan for 146 days, we can rearrange the formula to solve for the rate:
Rate = Interest / (Principal * Time)
Plugging in the values:
Rate = $488 / ($20,000 * 146/365)
Simplifying:
Rate = $488 / ($20,000 * 0.4)
Calculating:
Rate ≈ 0.061 or 6.1%
So, the interest rate on Omar's loan is approximately 6.1%.
