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Suppose you deposited $1,200 five years ago and another $800 three years ago in your savings account. If your current account balance shows 52,800 , what is the rate of return on your deposit?

asked
User Cfx
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1 Answer

7 votes

Answer:

the rate of return on your deposit is 2540%.

Step-by-step explanation:

To calculate the rate of return on your deposit, we need to determine the total amount you deposited and the total interest earned.

The amount deposited five years ago is $1,200, and the amount deposited three years ago is $800. Therefore, the total amount you deposited is:

Total deposit = $1,200 + $800 = $2,000

The current account balance is $52,800, which includes the total deposit amount plus the interest earned over the years.

Interest earned = Current account balance - Total deposit

Interest earned = $52,800 - $2,000 = $50,800

Now, we can calculate the rate of return using the formula:

Rate of return = (Interest earned / Total deposit) * 100

Rate of return = ($50,800 / $2,000) * 100

By performing the calculation, we find that the rate of return on your deposit is 2540%.

answered
User Zsolt
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