Final answer:
The interest rate earned on an investment that increased from $3050 to $3800 over three years is approximately 8.20%.
Step-by-step explanation:
The question is asking to determine the rate of interest earned on an investment that increased from $3050 to $3800 over three years. To calculate the interest rate, we need to use the formula for simple interest, which can be rearranged from I = Prt, where:
- I is the interest earned or the increase in value,
- P is the principal amount (the initial investment),
- r is the rate of interest per period,
- t is the time the money is invested for.
In this case, I = $3800 - $3050 = $750, P = $3050, and t = 3 years. Plugging into the formula and solving for r gives us the annual interest rate.
The calculation is as follows:
750 = 3050 × r × 3
750 = 9150r
r = 750 / 9150
r = 0.08196721311 or 8.20% when rounded to two decimal places.
Therefore, the annual rate of interest earned on the investment was approximately 8.20%.