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What annual simple interest rate will allow Hosea Soli to increase his initial investment of $80,000 to $100,000 in five years?

(Hint: Use the formula I = prt and substitute known values to find ...

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What annual simple interest rate will allow Hosea Soli to increase his initial investment of $80,000 to $100,000 in five years?

( Use the formula I = prt and substitute known values to find I.)
A)6%
B)5%
C)6.25%
D)5.5%

Answer

Using the formula I=prt I will use $80,000 for p or principle.
I will use 5% for r or rate.
(this needs to be converted to a decimal so move the decimal point two places to the left, you can't multiply using percents) and 5 years for t or time.
80,000*0.05*5=20,000.00.
He is getting $20,000 in interest.
So $80,000 + $20,000 = $100,00.
Therefore, the answer is B.

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Virtual Teaching Assistant: Colleen R.
Question Level: Basic
Karma: Free
Upload Date: 5/31/2017

This 39 words question was answered by Colleen R. on StudySoup on 5/31/2017. The question contains content related to Business Since its upload, it has received 165 views.

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