question archive At what rate must $800 be compounded annually for it to grow to $1600 in 9 years A 8
At what rate must $800 be compounded annually for it to grow to $1600 in 9 years A 8
Subject:FinancePrice:2.88 Bought25
At what rate must $800 be compounded annually for it to grow to $1600 in 9 years A 8.00% B) Other 6.00% 7.41%
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Future value = present value * (1+r)^n
1600 = 800 *(1+r)^9
1600/800 = (1+r)^9
2 =(1+r)^9
(2)^(1/9) = 1+r
1.08 =1+r
r = 1.08-1
r = 0.08
r = 8%
The correct answer is option A i.e. 8%
