Math help needed to Find the interest rate #11

label Mathematics
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Find the interest rate needed for an investment of $4,000 to grow to an amount of $5,000 in 4 yr if interest is compounded continuously. Please round the answer to the nearest hundredth of percent.
A.
B.
C.
D.
E.
Nov 8th, 2015

Thank you for the opportunity to help you with your question!

let the annual interest rate is d then compound continuously, we have 

4000*exp(d*4) =  5000

exp (4d) = 1.25

4d = ln 1.25 = 0.05578

A is correct

Please let me know if you need any clarification. I'm always happy to answer your questions.
Nov 8th, 2015

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