Mrs. Emily Francis saves RM10 000 in a bank . by the end of the eighth year , the money collected amounts to RM19 992.71.if the bank pays an annual interest of x% for a year and is compounded every 6months , calculate the value of x​

Accepted Solution

Answer:8.85% per yearStep-by-step explanation:To find the interest rate of a compounding interest, we use the formula:[tex]r=n[(\dfrac{A}{P})^{\dfrac{1}{nt}}-1][/tex]Before we start solving, let's break down all the variables that we have.A = 19,992.71P = 10,000.00n = 2t = 8r = ?Now let's put the values into the formula.[tex]r=2[(\dfrac{19,992.71}{10,000.00})^{\dfrac{1}{2(8)}}-1][/tex][tex]r=2[(\dfrac{19,992.71}{10,000.00})^{\dfrac{1}{16}}-1][/tex][tex]r=2[(\dfrac{19,992.71}{10,000.00})^{0.0625}-1][/tex][tex]r=2[(1.9992.1)^{0.0625}-1][/tex][tex]r=2[1.0442499885-1][/tex][tex]r=2[0.0442499885][/tex][tex]r=0.08849997699[/tex] or [tex]8.85%[/tex]So the rate the Mrs. Emily Francis got from the bank was 8.85% per year.