Answer: 3.88% (2dp)
Explanation:
The growth rate is calculated by subtracting the old figure from the new figure and dividing by the original figure.
This shows us how much the initial figure has grown by.
Calculating therefore would be,
= 12,985 - 12,500 / 12,500
= 0.0388
= 3.88%
3.88% is the annual growth rate for the money market account.
Answer:
The annual growth rate is 3.88%
Explanation:
The annual growth can be computed using the below formula:
(closing account balance-initial deposit)/initial deposit*100
closing account balance is $12,985
initial deposit is $12,500
annual growth rate=($12,985-$12,500)/$12,500*100
=$485/$12,500*100
=3.88%
The annual growth rate for the money market account is 3.88% as computed above,which implies that the account would double the initial investment in 18.04 years using the 70 rule(70/3.88)
