Leo invested $1900 in an account with annually compounded interest. After 3 years, he had $2275 in the account. What was the interest rate of the account? Round your answer to one decimal place. Do not write the percent sign.

6.6

Step-by-step explanation:

Principal = $1900

Interest = $2275 - $1900 = $375

Time = 3 years

Interest = PRT/100

where

P = principal

R = rate

T = time

We then slot in the values

375 = (1900 × R × 3)/100

375 = 5700R/100

Rate = 37500/5700

Rate = 6.6

6.2

Step-by-step explanation:

Use the formula for calculating compound interest PN=P0(1+rk)Nk where r is the unknown, PN=2275, P0=1900, k=1, and N=3. Substitute the values into the formula and simplify.

2275=1900(1+r1)3⋅1

Let's simplify within the parenthesis and the exponent.

2275=1900(1+r)3

Divide both sides by 1900.  

22751900=(1+r)3

To isolate the variable, take the cube root of each side.

22751900−−−−−√3=1+r

Subtract 1 from each side to get r by itself.  

22751900−−−−−√3−1=r

Simplify for an answer of r≈0.062 which is the interest rate 6.2%.

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step-by-step explanation: