Thread: investment

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?

I think it is

[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

[QUOTE=rcs;736298]

Originally Posted by DeMath

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

Need to find the annual single interest rate

, i.e. (annual rate).

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.