SOLUTION: James plans to invest his $2,755.73 that he has saved in a money market account so that it will grow to $3500.00 in three years and five months so that he can purchase his first ca

Algebra ->  Finance -> SOLUTION: James plans to invest his $2,755.73 that he has saved in a money market account so that it will grow to $3500.00 in three years and five months so that he can purchase his first ca      Log On


   

Question 1152734: James plans to invest his $2,755.73 that he has saved in a money market account so that it will grow to $3500.00 in three years and five months so that he can purchase his first car. At what simple interest rate would the money market account have to yield in order for James to achieve his goal? Round to the nearest tenth of a percent,

Thank you in advance
SYL
Answer by Boreal(15235) About Me  (Show Source):
You can put this solution on YOUR website!
the interest is 3500-2755.73=$744.27
Interest=prt, p, t, and i are all known
744.27=2755.73*r*41/12, the 41/12 is time in years
744.27=9425.41*r
r=0.079 or 7.9%