What is the rate of simple interest per annum on $800 for 3 years that amounts to $54?

• A. 1.5%
• B. 2.25%
• C. 2.5%
• D. 3%

Answer: (B)

To determine the rate of simple interest per annum, we first need to calculate the total interest earned over the entire period and then relate that to the principal amount and the time.

In this case, the total amount of interest accumulated after 3 years is given as $54. The principal amount (the initial sum invested) is $800, and the interest needs to be calculated on a per annum basis.

Using the formula for simple interest, we have:

[

\text{Interest} = \text{Principal} \times \text{Rate} \times \text{Time}

]

Rearranging this formula to find the rate of interest, we get:

[

\text{Rate} = \frac{\text{Interest}}{\text{Principal} \times \text{Time}}

]

Substituting the known values into the formula:

[

\text{Rate} = \frac{54}{800 \times 3}

]

Calculating this gives:

[

\text{Rate} = \frac{54}{2400} = 0.0225

]

Converting this decimal into a percentage involves multiplying by 100%:

[

\text{Rate} = 0