Respuesta :
The annual interest rate would have to be about 0.57% in order to earn $1200 in interest in 3.5 years. Rounded to two decimal places, the annual interest rate would have to be about 0.57%.
What is an annual interest rate?
The annual interest rate is the percentage of the principal (the initial amount of money invested or borrowed) that is charged as interest on a loan or earned on an investment over a period of one year. It is used to calculate the amount of interest that will be earned or charged over a given period of time.
To determine the annual interest rate that an account would have to offer in order to earn $1200 in interest in 3.5 years, we need to use the following formula:
rate = (interest / principal) * (1 / time)
Where the rate is the annual interest rate, interest is the amount of interest earned, the principal is the amount of money invested, and time is the length of time in years.
Plugging in the given values, we get:
rate = ($1200 / $60000) * (1 / 3.5)
= 0.02 * (1 / 3.5)
= 0.00571428571
Hence, the annual interest rate would have to be about 0.57% in order to earn $1200 in interest in 3.5 years. Rounded to two decimal places, the annual interest rate would have to be about 0.57%.
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