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anonymous

  • 5 years ago

Pls Help!! Use the formula B=P(1+(r/n))nt which is used to calculate the final balance of an investment or a loan after being compounded. Following is a list of what each variable represents: B = the final balance P = the principal r = the annual percentage rate t = the time in years in which the principal is compounded n = the number of times the principal is compounded in a year Raul invests $40,000 in an account that is compounded annually. If, after two years, his balance is $45,796, what was the interest rate of the account?

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  1. anonymous
    • 5 years ago
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    Are u helping me ...thank you , thank you , thank you

  2. anonymous
    • 5 years ago
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    yeah - sorry popcorn - i'll be back in about 5 minutes

  3. anonymous
    • 5 years ago
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    hi - you formula is incorrect. It should be B=P(1+(r/n))^nt - nt is an exponent so: 45796 = 40000(1 + r)^2 n=1 once a year (1+r)^2 = 45796 / 40000 = 1.1449 taking logs 2 ln(1+r) = ln 1.1449 ln (1+r) = ln 1.1449 / 2 1+r = 1.07 r = .07 = 7 % annual rate

  4. anonymous
    • 5 years ago
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    ok working thru it

  5. anonymous
    • 5 years ago
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    what is taking logs

  6. anonymous
    • 5 years ago
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    it means using the logarithm of the expression - its useful if the x is in the power live 2^x. so if got 2^x = 3.2 we can write ln 2^x = ln 3.2 so x ln2 = ln 3.2 and then x =ln3.2/ln2. hey - i could have done this another way - i could have expanded (1+r)^2 and solved for x. - but the log way is ok

  7. anonymous
    • 5 years ago
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    power like

  8. anonymous
    • 5 years ago
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    k i think my level is at the expansion level not log...would you be able to show me the other way??

  9. anonymous
    • 5 years ago
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    ok (1+r)^2 = 1.1.449 - hey - i've found another way we can take the square root of both sides 1 + r = sq rt 1.1449 =1.07 r = 1.07 - 1 = .07 I hope I haven't confused you with all these alternatives. I can't understand why I didn't see this easy way before!!

  10. anonymous
    • 5 years ago
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    got it thanks...if you are bored I have two other questions out there ;-)

  11. anonymous
    • 5 years ago
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    sorry popcorn its late here in uk and i've got an early start in the morning we are travelling to London to see my soccer team (Swansea) play a big game. I'll be here tomorrow evening.

  12. anonymous
    • 5 years ago
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    works for me...have fun

  13. anonymous
    • 5 years ago
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    bye

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