Answer:
Step-by-step explanation:
We would apply the formula for determining compound interest which is expressed as
A = P(1 + r/n)^nt
Where
A = total amount in the account at the end of t years
r represents the interest rate.
n represents the periodic interval at which it was compounded.
P represents the principal or initial amount deposited
From the information given,
P = 1100
A = 1900
n = 4 because it was compounded 3 times in a year and n = 12/3 = 4
t = 10 years
Therefore,.
1900 = 1100(1 + r/4)^4 × 10
1900/1100 = (1+ r/4)^40
1.73 = (1+ r/4)^40
Taking log to base 10 of both sides, it becomes
Log 1.73 = 40log(1 + 0.25r)
0.238 = 40log(1 + 0.25r)
Log(1 + 0.25r) = 0.238/40 = 0.00595
Take exponent of both sides, it becomes
10^log(1 + 0.25r) = 10^0.00595
1 + 0.25r = 1.0138
0.25r = 1.0138 - 1 = 0.0138
r = 0.0138/0.25
r = 0.0552
The The required annual interest rate is
0.0552 × 100 = 5.5%
