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[Dreamerish*~]

A sum of $30 000 was invested in a bank account at a fixed rate of interest, compounded annually. At the end of seven years, after the seventh interest payment has been made, the sum of money has grown to $50 000. What was the rate of interest, to the nearest one tenth of a percent?

Please show me some working. Thank you.

 

[acmilan]

A₁ = 30000 + 30000R = 30000(1+R)
A₂ = 30000(1+R) + 30000(1+R)R = 30000(1+R)²
.
.
.
A₇ = 30000(1+R)⁷


A₇ = 50000

30000(1+R)⁷ = 50000
(1+R)⁷ = 5/3
1+R = 1.0757037398427834669721365827715
R = 0.0757037398427834669721365827715
So the rate is 7.57% (unless ive made a mistake somewhere)

 

[Dreamerish*~]

(1+R)⁷ = 5/3
1+R = 1.0757037398427834669721365827715

Yes , that's what I had, but this step... how do you find the value of (1 + R)⁷?

Ah... never mind, I got it.

Thank you very much.