I invested $1585 for 5 years and earned $475.50 in interest. What was the interest rate?
1 answer:
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Answer:
Option d. $22154 is the right answer.
Step-by-step explanation:
To solve this question we will use the formula
In this formula A = amount after time t
P = principal amount
r = rate of interest
n = number of times interest gets compounded in a year
t = time
Now Lou has principal amount on the starting of first year = 10000+5000 = $15000
So for one year
= $15900
After one year Lou added $5000 in this amount and we have to calculate the final amount he got
Now principal amount becomes $15900 + $ 5000 = $20900
Then putting the values again in the formula
So the final amount will be $22154.