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

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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) About Me  (Show Source):
You can put this solution on YOUR website!
The formula for compound interest is:
A+=+P%281%2Bi%29%5En 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:
A+=+P%281%2Br%29%5Et
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.
1440+=+1000%281%2Br%29%5E2 Divide both sides by 1000
1.44+=+%281%2Br%29%5E2 Take the square root of both sides.
1.2+=+1%2Br Subtract 1 from both sides.
0.2+=+r Multiply by 100 to convert to percent.
r = 20%