SOLUTION: Suppose you borrow $10,000 right now to start a business. If the terms of the loan require you to pay back $12,000 in 5 years, what is the implied annual compound interest rate?

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Question 1124066: Suppose you borrow $10,000 right now to start a business. If the terms of the loan require you to pay back $12,000 in 5 years, what is the implied annual compound interest rate?
Answer by Alex.33(110) About Me  (Show Source):
You can put this solution on YOUR website!
Ny definition of compound interest:
10000%2A%281%2Br%29%5E5=12000
r=%286%2F5%29%5E%281%2F5%29-1,or
r=0.03713,approximately.

If you still do not understand or feel a bit vague on this, go search for 'compound interest' online. You'll find super clear explanations written by true experts.

Hope this solves your problem. Thanks!