Question

Determine the interest rate earmed on a $1,650 deposit when $1,950 is paid back in places.) one year. (Round your answer to 2 decimal Interest rate es 1of 20 Prey Next MacBook Air 888 % A & 9 5 6 7 8 2 3 E R T Y U J K S D G H B M C V S4 LLI

Answer 1

Interest rate earned

Here, we’ve Future Value = $1,960

Amount Deposited = $1,650

Number of years (n) = 1 Years

Annual Interest Rate (r) = ?

Future Value = Amount Deposited x (1 + r)ⁿ

$1,950 = $1,650 x (1 + r)¹

(1 + r)¹ = $1,950 / $1,650

(1 + r)¹ = 1.181818

r = 1.181818 – 1

r = 0.181818 or

r = 18.18% (Rounded to 2 decimal place)

“Therefore, the Interest rate earned on the deposit will be 18.18%”