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andrew borrowed $8500 loan which was compounded annually for 6 years. At the end of six years, he owed $11,085.95 (including the principal). To the nearest tenth of a percent, what was the interest rate.

 Oct 21, 2021
 #1
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andrew borrowed $8500 loan which was compounded annually for 6 years. At the end of six years, he owed $11,085.95 (including the principal). To the nearest tenth of a percent, what was the interest rate.

 

[11,085.95 / 8,500]^(1/6) ==1.045263 - 1 x 100 ==4.5263%==~4.5% - annual interest rate on the loan.

 Oct 22, 2021
 #2
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11085 = 8500 ( 1+i)^6

 1.3041176470588235 = (1+i)^6

1+i = 1.0452482809213813554

i = .04524    ~ 4.5 percent

 Oct 22, 2021

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