A college student borrowed $389 to buy books for his classes at the end of the year he paid back the principal and $6.85 and simple interest. What was his interest rate?

Interest rate is 1.76%

Simple interest formula:

I = P * r * t;

Where:

I = interest = 6.85

P = principal = 389

r = x

t = 1

6.85 = 389 * r * 1

6.85 = 389r

r = 6.85 / 389

r = 0.0176 * 100% = 1.76% interest rate.

In looking for missing values like: Principal or time if it involves simple interest, just use the simple interest formula and place the data provided by the problem before finding the unknown value.