Question

What rate of interest, to the nearest tenth of a percent, compounded annually is needed for an investment of $240 to grow to $350 in 5 years?

Answer 1

solve
\[350=240(1+r)^5\] for r

Answer 2

divide by 240, take the fifth root (with a calculator), then subtract 1

Answer 3

\[\frac{350}{240}=(1+r)^5\]
\[1+r=\sqrt[5]{\frac{350}{240}}\]
i get 1.0784

Answer 4

so
\[r=.0784=7.84\%\] rounded of course

Answer 5

thanks so much! I kept getting stuck in the beginning!