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Find the interest rate for an ​$8000 deposit accumulating to ​$9571.31​, compounded quarterly for 6 years.

The interest rate is ___%

User Dimiguel
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1 Answer

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Answer:

3.00%

Explanation:

You want the interest rate that will make an $8000 deposit achieve a value of $9571.31 in 6 years when interest is compounded quarterly.

Compound Interest

The compound interest formula can be solved for the interest rate when other values are known:

A = P(1 +r/n)^(nt) . . . . . . . interest at rate r compounded n times per year

9571.31 = 8000(1 +r/4)^(4·6) . . . . fill in known values

(9571.31/8000)^(1/24) = 1 +r/4

1 +r/4 ≈ 1.0075000

r ≈ 0.0075000 × 4 ≈ 3.00%

The interest rate is 3.00%.

__

Additional comment

A financial calculator, app, or spreadsheet can find this for you.

Find the interest rate for an ​$8000 deposit accumulating to ​$9571.31​, compounded-example-1
User Mischa Lisovyi
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