What interest rate compounded quarterly is earned if an investment of $3000 grows to $5000 in 2 years?
We can use the compound interest formula:
Where,
A = Amount
P = Principal amount invested
i = quarterly rate of interest
n = number of quarters. (2 years = 2*4 = 8 quarters)
Therefore,
OR
Since "i" is the quarterly interest rate, we have to multiply it with "4" to get annual interest rate.
Therefore,
Annual interest rate = 6.5936% * 4 = 26.37%
What interest rate compounded quarterly is earned if an investment of $3000 grows to $5000 in...
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