# Suppose you deposit \$ 1296 today and your account will accumulate to \$ 5637 in 9 years. What is the rate of interest? Input your answer in decimals, not percentages. Round your answer to four decimals places.

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Suppose you deposit \$ 1296 today and your account will accumulate to \$ 5637 in 9 years. What is the rate of interest? Input your answer in decimals, not percentages. Round your answer to four decimals places.

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Step 1

Maturity Amount, A  = \$ 5637

Principal deposited, P = \$ 1,296

Time period, T = 9 years

Step 2

Let's say interest rate per annum is R.

Then the maturity amount will be given by the compound interest formula:

A = P x (1 + R)T

Step 3

Thus, \$ 5,637 = \$ 1,296 x ( 1 + R)9

Hence, R = (5,637 / 1,296)(1/9) - 1 = 0.1774...

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