Juan Arancho has $12,000 and would like to double his money in 8 years. What rate would he need to earn to reach is goal?

A. 9.0508%

B. 8.8548%

C. 8.7589%

Solutions

Expert Solution

Formula:

Future value= present value(1+r)^n

r= interest rate for the period.

n = number of periods.

Double of 12000 is 24000.

So future value is 24000.

24,000 = 12,000*(1+r)^8

r= 9.05077

Answer: A. 9.0508%

jeff jeffy answered 2 years ago

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