0580/21 May/Jun 2024, Question 10: Compound Interest
Cambridge IGCSE Mathematics 0580 · Paper 21 (Extended) · Calculator · 3 marks
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The question, in short
Amir invests $1500 at r % compound interest per year; after 8 years the investment is worth $1656.73. Find the value of r.
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Solution · 3 marks
- 11500 × (1 + r/100)⁸ = 1656.73
- 2(1 + r/100)⁸ = 1656.73 ÷ 1500 = 1.104486…
- 31 + r/100 = ⁸√1.104486… = 1.0125
- 4r = 1.25
Answer1.25 or 1.250…
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