Question

Ron and Amie invested $5,000 in an educational savings account for their daughter when she was born. They were unable to ever add anything else to the account. What was the rate of return if they had $10,000 in the account after 12 years?

Answer 1

Answer:

$R=8.333%$%

Explanation:

Given,$Invested$ $amount$ $=$   $Principal=P=\ 5000$

$Return$ $amount$ $=$$Amount=A=\ 10000$

$Rate=R%$%

$Time=T=12years$

Solution,

$Simple$ $interest$$=S.I$$=P\times R\times T/100$

$S.I=\ 10000-\ 5000$

$S.I=\ 5000$

$5000=P\times R\times T/100$

$5000=5000\times R\times 12/100$

$5000\times 100/5000=R\times 12$

$R=100/12$

$R=8.333%$%