what is the interest rate compuonded quarterly that you will need to earn in order for an investment of $1255?

Question

cnotinuation:to grow to be 1690 after 2.75 years?

Answer 1

Use the compound interest formula:

A(t) = A (1+r/n)^(nt) where A(t) is final value, A is starting value, r is interest rate, n is number of times interest is counted in a year, t is number of years. In this case we want to figure r. Thus,
1690 = 1255 (1+ r/4)^(2.75)(4)
1690/1255 = (1+ r/4)^(11)
1.3466 = (1+ r/4)^(11)
(1.3466)^(1/11) = (1+ r/4)
1.0274 = (1+ r/4)
.0274 = r/4
r = .1096 or 10.96%

Answer 2

Answer: nearly 11% (10.97%)

General compounding formula:

FV = P(1+R/n)^(n*t)

FV = Future Value; P = Principal; R annual interest rate; n compounding periods per year; t years

You wish to solve for R given:

$1690 = $1255(1+R/4)^(4*2.75)

1.3466 = (1+R/4)^(11)
1.027423 = 1+R/4
0.027423 = R/4
R = 0.10969 = about 10.97%

Answer 3

2.75 years = 11 terms. so in the compound interest formula put t=11 and then solve.

Answer 4

I = P(1 + (r/n))^nt

1690 = 1255(1 + (r/4))^(4 * 2.75)
(338/251) = (1 + (r/4))^11
(1 + (r/4))^11 = (338/251)
11ln(1 + (r/4)) = ln(338/251)
ln(1 + (r/4)) = (ln(338/251))/11
1 + (r/4) = e^((ln(338/251))/11)
(r/4) = e^((ln(338/251))/11) - 1
r = 4e^((ln(338/251))/11) - 4
r = .109692738575
r = about 10.969% or about 11%