Since it's a simple interest, that means yo will apply the following formula:
I=Prn Where I = Amount of interest earned, P=initial capital, r, the rate or interest
$426 = $1200 x 5 years x r interest ,Calculate r:
426 = 1200 x 5 x r===> 426 = 6000 r; divide both sides by 6000
426 / 6000 = 6000 r / 6000 ==> ==> r= 0.071 or 7.1% This is the answer
