In this lesson, the student learns how to find the interest rate for an investment problem. They are given a formula and must solve the equation by factoring. The problem involves finding the interest rate if $2,000 increased to $2,420 in two years, and the answer must be written as a percent. While this is a mouthful, it's a real-life formula that can be used in investing. The lesson takes the student step by step through the process of working out the formula and factoring it to find the answer, which in this case is 10%.
This is a Word Problem you solve by writing an equation and factoring. Word Problem 7 - Investment problem-At the end of 2 years, P dollars invested at an interest rate r compounded annually increases to an amount, A dollars, given by a formula shown in video. Find the interest rate if $2000 increased to $2420 in 2 years. Write the answer as a percent.
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