Question

use the compound interest formula. A=P(1+r)^t and the given information to solve for r. A = $3000P = $2400t = 8 r = ____% (round to the nearest hundredth)

Answer 1

Replacing in the formula and solving for r, we have:

`\begin{gathered} A=P\mleft(1+r\mright)^t \\ 3000=2400(1+r)^8\text{ (Replacing)} \\ 1.25=(1+r)^8\text{ (Dividing by 2400 on both sides of the equation)} \\ \sqrt[8]{1.25}=1+r\text{ (Taking the eighth root on both sides of the equation)} \\ 1.028=1+r\text{ } \\ 0.0283=r\text{ (Subtracting 1 from both sides of the equation)} \\ \text{The answer is 2.83\% after converting the decimal number to percentage.} \end{gathered}`