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5 November, 14:57

You have $1000 to invest in an account and need to have $2000 in one year. What interest rate would you need to have in order to have this if the amount is compounded weekly? Round your answer to the nearest percent.

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  1. 5 November, 14:58
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    69.8%

    Step-by-step explanation:

    The weekly interest rate is computed using 52 weeks a year as per standard investment practice.

    FV=PV * (1+r/52) ^n*52

    FV is the future value of $2000

    PV is the present worth of $1,000

    r is the unknown

    n is the number of years which is 1

    2000=1000 * (1+r/52) ^1*52

    divide both sides by 1000

    2000/1000 = (1+r/52) ^52

    divide the index of the both sides by 52

    (2000/1000) ^ (1/52) = 1+r/52

    1.013418991 = 1+r/52

    r/52=1.013418991 - 1

    r/52=0.013418991

    r=0.013418991 * 52=69.8%
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