document.write( "Question 1133598: If the simple interest on a sum equals to 1/10 of itself in 4 years, find the rate percent. \n" ); document.write( "

Algebra.Com's Answer #750846 by htmentor(1343) $\"\"$ $\"About$

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If the interest earned is 1/10 of the initial principal, P0, then the amount after 4 years is P = 1.1*P0.
\n" ); document.write( "The simple interest formula, for yearly compounding, is
\n" ); document.write( "P = P0(1+r)^n where r = the interest rate, n = the number of years
\n" ); document.write( "Thus 1.1 = (1+r)^4
\n" ); document.write( "Solve for r:
\n" ); document.write( "1.1^(1/4) - 1 = r -> r = 0.0241, or 2.41%. \n" ); document.write( "

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