Friday

March 6, 2015

March 6, 2015

Posted by **C.J.** on Saturday, June 6, 2009 at 7:44pm.

- Math/Economics -
**Anonymous**, Saturday, June 6, 2009 at 8:42pmI dont think I am right, but $83.33 or 32.13 I am b=not sure

- Math/Economics -
**MathMate**, Saturday, June 6, 2009 at 8:45pmLet r=interest rate

385.63*(1+r)^{12}=1000

(1+r)^{12}= 1000/385.63 = 2.5932

Solve for 1+r and calculate r as the interest rate.

Quick check:

Rule of 72 says that money invested at r% will double in 72/r years (approximately).

Since the investment has more than doubled in 12 years, the interest rate should be*more*than 72/12=6%.

In fact, it is over 8%.

Post your results if you want to check.

**Answer this Question**

**Related Questions**

Finance 200 - . If you purchase a zero coupon bond today for $225 and it matures...

fINANCE - If you purchase a zero coupon bond today for 225 and it matures at ...

finance - If you purchased a zero coupon bond today for $225 and it maturity ...

Finance - Zeta Corporation has issued a $1,000 face value zero-coupon bond. ...

Corporate Finance - The yield-to-maturity on a bond is the interest rate you ...

Finance - Bond value and time--Constant required returns Pecos Manufacturing has...

Finance - Heinz Corporation bonds carry a coupon of 8% and will mature in 5 ...

Finance - Heinz Corporation bonds carry a coupon of 8% and will mature in 5 ...

Economics - Isabella buys a $1,000 bond that matures in 10 years (that is, she ...

Finance - You buy a very risky bond that promises a 9.5% coupon and return of ...