if an investment of $ 25,000 accumulates to P27,500 in 18 months, find the single interest rate?

this is my attempt: 27,000 - 25,000 = 2000 / 18 then the quotient is divided by 25,000. is this possible?

Printable View

- September 15th 2012, 06:54 AMrcsinvestment
if an investment of $ 25,000 accumulates to P27,500 in 18 months, find the single interest rate?

this is my attempt: 27,000 - 25,000 = 2000 / 18 then the quotient is divided by 25,000. is this possible? - September 15th 2012, 09:25 AMDeMathRe: investment
I think it is

- September 15th 2012, 09:57 AMrcsRe: investment
[QUOTE=DeMath;736289]I think it is

[/QUOTE

thanks but... the key answer from the book said that it is 6 2/3 % hmmmmmmmm... im confused... im still solving it here huuhuhuuhuh :( - September 15th 2012, 10:10 AMDeMathRe: investment
- September 17th 2012, 08:34 AMWilmerRe: investment
Very unclear question.

25000(1 + i)^1.5 = 27500

(1 + i)^1.5 = 27500/25000

1 + i = (27500/25000)^(1/1.5) : remember that if a^p = b, then a = b^(1/p)

i = (27500/25000)^(1/1.5) - 1

i = .0656... : so annual rate = ~6.56%

Your 6 2/3% result assumes SIMPLE interest; if so, then SHOULD be specified in the problem statement.