SOLUTION: if the sum of money when compounded annually become 1140 in a 2 years & 1710 in 3 years at the rate of interest A 30% B 40% C 50% D 60%

Question 1085153: if the sum of money when compounded annually become 1140 in a 2 years & 1710 in 3 years at the rate of interest
A 30%
B 40%
C 50%
D 60%
Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
in 2 years it is equal to 1140
in 3 years it is equal to 1710

between year 2 and year 3, it grew from 1140 to 1710.

this means that the third year amount is 1.5 * the second year amount, because 1710 / 1140 = 1.5

the actual growth rate would be (1710 - 1140) / 1140 = .5

a growth rate of .5 is equal to 50%.

your solution should be 50%.

a growth rate of 50% means that the value at each succeeding year is 1.5 times the value of the preceding year.

to find out what the starting value must have been, divide 1140 by (1.5)^2 to get 506 and 2/3.

multiply 506 and 2/3 by 1.5^3 and you get 1710.

RELATED QUESTIONS
Find the rate at which a sum of money will become four times the original amount in 2... (answered by Alan3354)

Find the rate at which a sum of money will double itself in 3 years , if the interest is... (answered by jorel555)

Calculate the amount of money you will have in an account at the end of the five years... (answered by cta1987)

Nate invests $3000 at a 6% interest rate for 3 years. If interest is compounded annually, (answered by rfer)

Determine the rate of interest for a sum that becomes 343/216 times itself in 3 years... (answered by Theo)

At what rate percent will a sum of w 3,125 amount to w 3,645 in 2 years, if the interest (answered by stanbon)

What single sum of money paid at the end of 3 years will fairly discharge two debts, one... (answered by Theo)

At what rate percent compound interest does a sum of money become 2.25 times of itself in (answered by ewatrrr)

1. What nominal rate compounded semi-annually is equivalent to a 10% effective rate?... (answered by ikleyn)