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Popular Word Problems >

Mark deposited 10,000.00 into a new savings account that earns interest compounded annually. After 10 years, the balance in the account was 21,947.00. What was the interest rate on the account?

Solution

M a r k d e p os i t e d 10, 000.00 in t o a n e w s a v in g s a cco u n t t ha t e a r n s in t eres t co m p o u n d e d ann u a ll y . A f t er 10 ye a rs, t h e ba l an ce in t h e a cco u n t w a s 21, 947.00. Wha t w a s t h e in t eres t r a t e o n t h e a cco u n t ?

Solution

Rate : 8.17764 \dots %

Solution steps

Translate the problem into an equation:

21947 = 10000 (1 + \frac{r}{1})^{1 \cdot 10}

Solve for

r, 21947 = 10000 (1 + \frac{r}{1})^{1 \cdot 10} : r = 8.17764 \dots %

Rate : 8.17764 \dots %

Popular Examples

In 20 years, Joe would be thrice his age 4 years ago. How old will he be in two years?The diameter of a circle is 13 in. Find its area to the nearest whole number.Jayce deposited 1500 at 7% interest compounded annually for 3 years. How much will Jayce earn after 3 years?23 is 50% of what number If 14,000 is invested at 7% annual interest, which is compounded continuously, what is the account balance after 12 years, assuming no additional deposits or withdrawals are made?