What was the interest rate if your balance on an investment of 27750 at the end of six years is 41070

To calculate the interest rate on an investment, we can use the **compound interest formula**:

\[
A = P(1 + r)^t
\]

Where:
- $ A $ is the final amount (balance) = 41070,
- $ P $ is the initial principal (investment) = 27750,
- $ r $ is the interest rate (which we are solving for),
- $ t $ is the time in years = 6.

Rearranging the formula to solve for $ r $:

\[
r = \left( \frac{A}{P} \right)^{\frac{1}{t}} - 1
\]

Let's calculate the interest rate.

The interest rate on your investment is approximately **6.75%** per year.

Would you like more details or have any questions? Here are some related questions:

1. What is the difference between simple and compound interest?
2. How would the final amount change if the interest was compounded quarterly?
3. What would be the balance after 10 years at the same interest rate?
4. How does inflation affect the real value of interest earned on investments?
5. Can you calculate interest rates for other periods, like monthly or daily?

**Tip**: The more frequently interest is compounded, the higher the final balance will be.

What was the interest rate if your balance on an investment of 27750 at the end of six years is 41070?

Discover how to calculate the interest rate on an investment of $27,750 after 6 years with a final balance of $41,070. This detailed explanation uses the compound interest formula to find the rate, perfect for high school students studying algebra and finance.

Math Problem Statement

Solution

Ask a new question for Free

By Image

Math Problem Analysis

Mathematical Concepts

Formulas

Theorems

Suitable Grade Level

Related Recommendation