Question

When your father was born 48 years ago, his grandparents deposited $250 in an account for him. Today, that account is worth $36,500. What was the annual rate of return on this account

Answer 1

Answer:

10.94%

Explanation:

Your father was born 48 years ago

His grandfather deposited $250 in an account for him

Today the money is worth $36,500

The annual rate of his return can be calculated as follows

= 36500/250 ×1/48= (1+r/100)

= 146^0.020833= (1+r/100)

= 1.1094-1

= 0.10940×100

= 10.94%