SOLUTION: Twenty-two hundred dollars is invested for two years in an account that has interest compounded annually. What was the annual intrest rate on the account if at the end of two years
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Question 242554: Twenty-two hundred dollars is invested for two years in an account that has interest compounded annually. What was the annual intrest rate on the account if at the end of two years it contained $2623.42? Using the model 2623.42=2200(1+r)^2. Showing it in steps. Answer by stanbon(75887) (Show Source):
You can put this solution on YOUR website! Twenty-two hundred dollars is invested for two years in an account that has interest compounded annually. What was the annual interest rate on the account if at the end of two years it contained $2623.42? Using the model 2623.42=2200(1+r)^2. Showing it in steps
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2623.42=2200(1+r)^2
Divide both sides by 2200 to get:
(1+r)^2 = 1.19246...
1+r = 1.092
r = 0.092
r = 9.2%
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Cheers,
Stan H.
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