Answer:
6%.
Step-by-step explanation:
We have been given that Tammy deposited $520 in the bank account that earns simple interest every year after 5 years she had earned $156.
To find the interest rate we will use simple interest formula.
[tex]I=P*r*T[/tex]
I= Interest.
P= Principal amount.
r=Annual interest rate (in decimal form).
T= Time in years.
We have been given that I=156, T=5, P=520
Upon substituting our values in above formula we will get,
[tex]156=520*r*5[/tex]
[tex]156=2600r[/tex]
[tex]r=\frac{156}{2600}[/tex]
[tex]r=0.06[/tex]
Let us multiply 0.06 by 100 to convert annual interest rate in percentage.
[tex]0.06*100=6 \text{ percent}[/tex]
Therefore, the annual interest rate was 6%.
