Thread: [SOLVED] Interest rates!!

Using the formula

A= P(1 + r/n) ^tn

At what interest rate to the nearest hundredth of a percent, will 16,000 grow to 20,000 if invested for 5.25years and the interest is compounded quarterly?

I have hit a wall with this one! Please help if you can..

Originally Posted by momuvfour

Using the formula

A= P(1 + r/n) ^tn

At what interest rate to the nearest hundredth of a percent, will 16,000 grow to 20,000 if invested for 5.25years and the interest is compounded quarterly?

I have hit a wall with this one! Please help if you can..

solve for

I understand the set up and I get about halfway through it but this is where I am stuck..

20000/16000 = (1+r/4)^21

1.25 = (1+r/4)^21

Any ideas from here? Sorry my math editor would not copy over..

Originally Posted by momuvfour

I understand the set up and I get about halfway through it but this is where I am stuck..

20000/16000 = (1+r/4)^21

1.25 = (1+r/4)^21

Any ideas from here? Sorry my math editor would not copy over..

Take the 21st root of both sides:




which can be evaluated on a calculator.


Also, if you want to see what someone has typed in LaTeX click on their working to give the code