# Finance

Calculating Interest Rate. Find the interest rate implied by the following combinations of present and future values.

PresentValue Years Future Value
\$400 11 \$684
\$183 4 \$249
\$300 7 \$300

Since you do not state otherwise, I am assuming that your interest rate is compounded annually.
I will do the second of your questions.

Using Amount = Present Value(1+i)^n
we do not know i.

249=183(1+i)^4
1.3606557=(1+i)^4
take the fourth root
1.0800331=1+i
giving you i=0.0080031
so the annual rate is 8%

by observation the rate for you last question is clearly 0%

1. π 0
2. π 0
3. π 73
1. 460 present 11 years 968 future value

1. π 0
2. π 0
posted by Anonymous

## Similar Questions

1. ### Finance

Find the future value of \$10,000 invested now after five years if the annual interest rate is 8 percent. a. What would be the future value if the interest rate is a simple interest rate? b. What would be the future value if the

asked by tisha on August 22, 2012
2. ### Math

Deborah deposits \$200 into an account that pays simple interest at the rate of 7%. How much will she have at the end of 4 months? a) Present Value with simple interest b) Future Value with simple interest c) Future Value with

3. ### efe

find the formula for calculating compound interest. If Mr. John Chrystal invests \$6,000 today (Present Value) at a compound interest of 9 percent, calculate the Future Value of the investment after 30 years using the compound

asked by Anonymous on October 21, 2016
4. ### programming

Having troube with java, i am not a regular programmer, if anybody can help me out writting this program: write a program that takes two numbers from the java console representing, respectively, an investment and an interest

asked by John on February 4, 2010
5. ### math

a formula for calculating simple interest is I = Pr, were I is the interest earned in dollars, P is the principal or original investment, and r is the fixed rate of interest. If the amount of interest earned is \$2.25 and the

asked by sherry on February 14, 2013

1. Find the future value of current \$1,000 5 year from now when annual interest rate 8% is compounded annually 2. Find the present value of a future value (1,000) four years from now when annual interest rate 8% is compounded

asked by J on November 20, 2014
7. ### help

The interest rate on a second mortgage was5 7/8 % last month. This month the interest rate is 7 3/2 %. How many percentage points has the interest rate increased? Are you sure you mean 7 3/2% ? No lender would write an intereest

asked by carmen on March 26, 2007
8. ### Econ

The 1-year interest rate on Swiss francs is 5 percent and the dollar interest rate is 8 percent. (A) if the current \$/SF spot rate is \$0.60, what would you expect the spot rate to be in 1 year. (B) Suppose US policy changes and

asked by Leon on December 10, 2014
9. ### math

You want to explain to your friend that your bankβs interest rate has gone down from 1.2% to 0.3%. Which sentence below has the correct meaning? A)My interest rate has decreased 25%. B)My interest rate has decreased 0.9

asked by jordan on May 9, 2013
10. ### AP Macroeconomics

3. You buy a certificate of deposit (CD) that pays a nominal rate of 12% annually. You have a tax rate of 25%, so if the interest on this CD is taxable (which it may not be) your after-tax nominal rate is (1 Γ± 25%) β’ 12% = 9%.

asked by Emily on October 21, 2013

More Similar Questions