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12 July, 01:13

Penn Station is saving money to build a new loading platform. Two years ago, they set aside $24,000 for this purpose. Today, that account is worth $28,399. What rate of interest is Penn Station earning on this investment?

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  1. 12 July, 03:56
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    0,087792106 = rate

    Explanation:

    We need to calculate the interest of the investment

    principal x (1 + rate) ^time = value

    replacing with the know values

    24,000 x (1+rate) ^2 = 28,399

    28,399/24,000 = (1 + rate) ^2

    sqrt (28,399/24,000) - 1 = rate

    now we solve for the unknown value

    0,087792106 = rate
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