document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=920350>Question 920350</A>: <I><SPAN STYLE=\"word-break: break-all;\"> ind the interest rate needed for an investment of $5,000 to grow to an amount of $5,500 in 6 months if interest is compounded monthly </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #558311 by </B><A HREF=/tutors/aboutme.mpl?userid=lwsshak3><B>lwsshak3(11628)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=lwsshak3><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=558311\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Find the interest rate needed for an investment of $5,000 to grow to an amount of $5,500 in 6 months if interest is compounded monthly.<BR>\n" );
document.write( "***<BR>\n" );
document.write( "compound interest formula: A=P(1+r/n)^nt, P=initial investment, r=interest rate, n=number of compounding periods per year, A=amount after t-years.<BR>\n" );
document.write( "..<BR>\n" );
document.write( "For given problem:<BR>\n" );
document.write( "P=$5000<BR>\n" );
document.write( "r=?<BR>\n" );
document.write( "n=12<BR>\n" );
document.write( "A=$5500<BR>\n" );
document.write( "t=0.5<BR>\n" );
document.write( "..<BR>\n" );
document.write( "5500=5000(1+r/12)^(12*0.5)<BR>\n" );
document.write( "5500/5000=(1+r/12)^6<BR>\n" );
document.write( "1.1=(1+r/12)^6<BR>\n" );
document.write( "raise both sides to the (1/6) power<BR>\n" );
document.write( "1.0160=1+r/12<BR>\n" );
document.write( "r/12=.0160<BR>\n" );
document.write( "r=12*.0160=0.192<BR>\n" );
document.write( "Interest rate=19.2% </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );