Question

 (Solving for r in compound interest) If you were offered $1,404,58 8 years from now in return for an investment of $400 currently, what annual rate of interest would you eam if you took the offer? 

If you took the offer, the annual interest rate you would earn is % (Round to the nearest whole percent.) 

Answer 1

Amount invested = $400.00
Future value = $1,404.58
Time period = 8 years

Amount invested * (1 + Interest rate)^Time period = Future value
$400.00 * (1 + Interest rate)^8 = $1,404.58
(1 + Interest rate)^8 = 3.51145
1 + Interest rate = 1.17
Interest rate = 0.17 or 17%

If you took the offer, the annual interest rate you would earn is 17%