Question 968670

At what interest rate will ${{{500}}} grow to ${{{572.45}}} on {{{2}}} yrs?
using {{{A = P(1+r)^2}}}, we have

{{{572.45 = 500(1+r)^2}}}

{{{572.45/ 500=(1+r)^2}}}

{{{1.1449=(1+r)^2}}}

{{{sqrt(1.1449)=sqrt((1+r)^2)}}}

{{{sqrt(1.1449)=1+r}}}

{{{1.07=1+r}}}

{{{1.07-1=r}}}

{{{r=0.07}}} or {{{7}}}%

check:

first year {{{500+500*0.07=500+35=535}}}
second year {{{535+535*0.07=535+37.45=572.45}}}