Question

Question

George invested $4400 in an account with annually compounded interest. After 5 years, he had $5790 in the account. What
was the interest rate of the account? Round your answer to one decimal place. Do not write the percent sign,​

Answer 1

compounded annually:

A = P(1 + r)^t

A = accumulated amount = $5790
P = original amount invested = $4400
r = interest rate (in decimal form) = ? what it is asking for
t = time in years = 5 years

$5,790 = $4,400(1 + r)^5
r = 5.644% or 0.05644

Answer 2

The rate of interest was approx 5.64%.

Explanation:

The compound interest formula is :

`A=p(1+(r)/(n) )^(nt)`

Here p = 4400

r = ?

n = 1

t = 5

A = 5790

Now putting the values in formula we get;

`5790=4400(1+(r)/(1) )^(5)`

=>
`5790=4400(1+r )^(5)`

=>
`(5790)/(4400) =(1+r )^(5)`

=>
`1.316=(1+r )^(5)`

=>
`1+r=\sqrt[5]{1.316}`

r = 0.0564

In percentage it is
`0.0564*100` = 5.64%

Hence, the rate of interest was approx 5.64%.