You currently have $11,167 in your savings account.What interest rate do you need to earn in order to have $20,000 in the account in 10 years?
A)6%
B)8%
C)10%
D)There is not enough information to solve this question.

Question

Quizplus · Accepted Answer

To find the required interest rate, we can use the formula for compound interest: A = P(1 + r)^n, where A is the amount of money accumulated after n years, including interest, P is the principal amount (the initial amount of money), r is the annual interest rate (decimal), and n is the time the money is invested for in years. Rearranging the formula to solve for r gives us r = (A/P)^(1/n) - 1. Plugging in the given values: A = $20,000, P = $11,167, and n = 10 years, we can solve for r. This calculation shows that the interest rate needed is approximately 6%.

You Currently Have $11,167 in Your Savings Account