Find the effective annual rate #18

Anonymous
account_balance_wallet \$5

Question Description

Juan invested \$24,000 in a mutual fund 5 years ago. Today his investment is worth \$34,616. Find the effective annual rate of return on his investment over the 5-year period.
 A. 10.3%/year B. 8%/year C. 83%/year D. 8.3%/year

Doctor_Ralph
School: New York University

24000(1+r)^5 = 34616

(1+r)^5 =34616/24000

1 + r=fifth root of 34616/24000

1 + r =1.076

r=0.076 * 100

r=8%

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Anonymous
Goes above and beyond expectations !

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