SOLUTION: Sarah wants her $9000 GIC to double in value in nine years. What annual rate of interest is required for her to reach her goal. Assume interest is compounded annually.

Algebra ->  Quadratic Equations and Parabolas  -> Quadratic Equations Lessons  -> Quadratic Equation Lesson -> SOLUTION: Sarah wants her $9000 GIC to double in value in nine years. What annual rate of interest is required for her to reach her goal. Assume interest is compounded annually.      Log On


   

Question 129857: Sarah wants her $9000 GIC to double in value in nine years. What annual rate of interest is required for her to reach her goal. Assume interest is compounded annually.
Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
Sarah wants her $9000 GIC to double in value in nine years. What annual rate of interest is required for her to reach her goal. Assume interest is compounded annually.
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A(t) = Ao(1+r/n)^(nt)
18000 = 9000(1 + r/1)^(1*9)
2 = (1+r)^9
Take the 9th root of both sides to get:
1+r = 1.08
r = 0.08
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The annual rate must be 8%
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Cheers,
Stan H.