If P dollars are deposited at an interest rate r and compounded n times, the future value An can be found by the formula An=P(1+r)n. find the rate of interest if a principal amount of $4500 grows to $5644.80 in 2 years if interest is compounded annually

Question

anonymous · Answer

Just need some help getting started on this one.

anonymous · Answer

Compounded annually means that your n = (2)(12) and your r = interest/12. So solve for r and then find I by multiplying by 12.
$$5644.80 = 4500(1 + r)^{24}$$

solve for r

anonymous · Answer

divide 5644.80 by 4500 right?

anonymous · Answer

yes

anonymous · Answer

Ok...the ^24 is confusing me.  so far: (1+r)^24=1.2544

anonymous · Answer

yes take the 24th root of 1.2544

anonymous · Answer

the just solve for the positive result of 1-r

anonymous · Answer

I mean 1+r

anonymous · Answer

Well, I did something wrong...did not get right answer.

anonymous · Answer

what did you do?

anonymous · Answer

1.2544^24=230.39

anonymous · Answer

no
that is wrong

anonymous · Answer

yep, it's wrong all right..

anonymous · Answer

$$24\sqrt{1.2544}$$

anonymous · Answer

you should get 1.009488793

anonymous · Answer

or 10%?

anonymous · Answer

rounded

anonymous · Answer

no that is not done yet

anonymous · Answer

subtract 1 and multiply it by 12.

anonymous · Answer

of course not, can't be that simple :)

anonymous · Answer

11.38 % about is that an option... think more clearly.. there is no way the interest can be 230.39 lol

anonymous · Answer

That's my problem, math and I do not speak the same language! lol

anonymous · Answer

that's fine.. practice makes perfect.

anonymous · Answer

ok, that does make way more sense.

anonymous · Answer

Thank you, now off to practice some more of these great word problems!

anonymous · Answer

have fun ;) cya yw