Question

how would i answer this problem?
Angela currently has a account balance of $4,298.55. she opened the account 15 years ago with a deposit of $1,987.22. If the interest compounds monthly, what is the interest rate on the account?

I know it looks like this when plugged into the formula:

4,298.55= 1,987.22(1+x/12)^12*15

how do i solve this though?

Answer 1

You have the right values and you plugged them in the right way. So far so good

Answer 2

Let's now solve for x

4298.55= 1987.22(1+x/12)^(12*15)

4298.55= 1987.22(1+x/12)^(180)

4298.55/1987.22 = (1+x/12)^(180)

2.16309719105081 = (1+x/12)^(180)

(2.16309719105081)^(1/180) = 1+x/12

1.00429553882183 = 1+x/12

1.00429553882183-1 = x/12

0.00429553882183 = x/12

0.00429553882183*12 = x

0.05154646586196 = x

x = 0.05154646586196

So the interest rate is roughly 5.15%

Answer 3

so i dont have to use ln?

Answer 4

no because there isn't a variable in the exponent

Answer 5

oh ok thanks

Answer 6

yw