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You are saving money to buy a used car. You deposit $2,500 in an account that earns interest compounded annually. The expression 2500(1+r)^2 represents the balance after 2 years, where r is the annual interest rate in decimal form

User Josinalvo
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1 Answer

5 votes

Answer:


r= [((A)/(2500)) ^(1)/(2) -1]

Explanation:

Given data

Principal = $2500

time t= 2 years

Required

the rate r

Given the expression for the balance 2500(1+r)^2

Hence


A= 2500(1+r)^2

we can make r subject of formula


r= [((A)/(P)) ^(1)/(t) -1]


r= [((A)/(2500)) ^(1)/(2) -1]

Hence, for any value of A, we can find the rate using the expression above

User Bertjan Broeksema
by
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