Question

Can someone help me answer this question please?

The formula

`r = \sqrt{ (a)/(p) } - 1`
gives the interest rate r, expressed as a decimal that will

allow principal P to grow into amount A in two years, if the interest is compounded annually. Suppose you have $350 to deposit into an account. Find the interest rate you would need to have $380 in the account at the end of the second year.

A. 4.4%

B. 0.042%

C. 4.2%

D. 104.1%​

Answer 1

r = 4.2 %

Explanation:

r = sqrt( a/p) -1

We have the principle = 350

The amount = 380

r = sqrt(380/350) -1

r = sqrt(1.085714286)-1

r =1.041976145-1

r = .041976145

Changing to decimal form

r =4.1976145%

r = 4.2 %