Lawson Company invests $60,000 today and has $148,560 by the end of eight years. What is the firm's compound annual interest rate?
A) 10.00%.
B) 12.00%.
C) 18.45%.
D) 40.39%.
E) None of the other answers are correct.

Question

Quizplus · Accepted Answer

The compound annual interest rate can be calculated using the formula for compound interest: $ A = P(1 + r)^n $. Here, $ A = 148,560 $, $ P = 60,000 $, and $ n = 8 $. Solving for $ r $ gives approximately 12.00%.

Lawson Company Invests $60,000 Today and Has $148,560 by the End