SOLUTION: I think I'm missing an integral piece... can you give me a hand? Using the formula: A=P(1+r)^2 In order for $1000.00 to increase to $1440.00 in 2 years, what is the interest

Question 128716This question is from textbook
: I think I'm missing an integral piece... can you give me a hand?
Using the formula: A=P(1+r)^2
In order for $1000.00 to increase to $1440.00 in 2 years, what is the interest rate?
Thanks. This question is from textbook

Answer by Earlsdon(6294) (Show Source): You can put this solution on YOUR website!
The formula for compound interest is:
where A = present amount, P = the principal invested, i = the interest rate (expressed as a decimal), and n = the number of years.
You may also see this written:

In your problem, you will substitute A = $1,440.00, P = $1,000.00, and n = 2 years. So make the appropriate substitiutions and solve for r.
Divide both sides by 1000
Take the square root of both sides.
Subtract 1 from both sides.
Multiply by 100 to convert to percent.
r = 20%
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