SOLUTION: Suppose you invest $7,000 in a mutual fund that pays simple interest for one year. If you earn at most $920 at the end of 18 months, what is the maximum annual interest rate for th
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Question 167499This question is from textbook
: Suppose you invest $7,000 in a mutual fund that pays simple interest for one year. If you earn at most $920 at the end of 18 months, what is the maximum annual interest rate for this investment.
This question is from textbook
You can put this solution on YOUR website! Suppose you invest $7,000 in a mutual fund that pays simple interest for one year. If you earn at most $920 at the end of 18 months, what is the maximum annual interest rate for this investment.
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I = Prt
920 >= 7000*r*(3/2)
3500*3r <= 920
r <= 920/(3*3500)
r <= 0.0876 = 8.76%
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Cheers,
Stan H.
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