After 3 years a 1500 investment is worth 1680 what is the intrest rate on this investment

Question

asked Feb 3, 2020 69.6k views

2 Answers

Lucasvc · Answer 1 · 2020-02-06T22:59:40+0000

Answer:

The rate of interest for the investment is 3.8

Explanation:

Given as :

The Principal = 1500 unit

The Amount after 3 years = 1680 unit

The Time period = 3 years

Let The annual rate of interest = R %

From compounded method

Amount = Principal ×

Or, 1680 = 1500 ×
(1+(Rate)/(100))^(3)

Or,
(1680)/(1500) =
(1+(Rate)/(100))^(3)

Or, 1.12 =
(1+(Rate)/(100))^(3)

Or,
$(1.12)^{(1)/(3)}$ = 1 +
(R)/(100)

Or, 1.038 = 1 +
(R)/(100)

So, 1.038 - 1 =
(R)/(100)

∴ 0.038 × 100 = R

I.e R = 3.8

Hence The rate of interest for the investment is 3.8 Answer