SOLUTION: I need ur urgent help on this finance question. an investor expects the value of a $1000 investment to triple within 12 years. what is the expected annual rate of growth in the

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Question 881280: I need ur urgent help on this finance question.
an investor expects the value of a $1000 investment to triple within 12 years. what is the expected annual rate of growth in the investment
Answer by josmiceli(19441) About Me  (Show Source):
You can put this solution on YOUR website!
Initial investment = $1,000
In 12 years the investment becomes $3,000
+3000+=+1000%2A%28+1+%2B+r+%29%5E12+
where +r+ is the annual rate of return
+3+=+%28+1+%2B+r+%29%5E12+
Take the log of both sides
+log%283%29+=+12%2Alog%28%28+1+%2B+r+%29%29+
+.477121+=+12%2Alog%28%28+1+%2B+r+%29%29+
+log%28%28+1+%2B+r+%29%29+=+.03976+
+10%5E.03976+=+1+%2B+r+
+1.09587+=+1+%2B+r+
+r+=+.09587+
The annual percentage rate is 9.59%
check:
+3000+=+1000%2A%28+1+%2B+r+%29%5E12+
+3+=+1.09587%5E12+
+3+=+2.99991+
looks close enough