Question

The interest rate r required to increase your investment p to the amount a in t years found by r= (a/p)^(1/t) -1. Find the interest rate r for p = 8100, a= 10,000, and t=2. A. 111.11% B. 1.11% C. 0.11% D. 11.11%

Answer 1

0.11%

Explanation:

.

Answer 2

`\bf r=\left( (a)/(p) \right)^{(1)/(t)}~~ \begin{cases} p=8100\\ a=10000\\ t=2 \end{cases}\implies r=\left( \cfrac{10000}{8100} \right)^{(1)/(2)}\implies r=\sqrt{\cfrac{10000}{8100}} \\\\\\ r=\sqrt{\cfrac{100}{81}}\implies r=\cfrac{√(100)}{√(81)}\implies r=\cfrac{10}{9}\implies r\approx \stackrel{\%}{1.11}`