Respuesta :
The annual internal rate of return will be 16.8%. The principal amount is $3000. The amount recieved after 5 years is $6500. The annual internal rate of return will be:
A=[tex]P(1+\frac{r}{100} )^{n}[/tex]
6500 = [tex]P(1+\frac{r}{100} )^{5}[/tex]
6500/3000 = [tex](1+\frac{r}{100} )^{5}[/tex]
2.17 = [tex](1+\frac{r}{100} )^{5}[/tex]
Finding out the 5cube root of 2.17
1.168 = (1+r/100)
1.168 = (100+r )/100
116.8 = 100 + r
r = 116.8 - 100
r = 16.8%
The annual rate of return is the return that we get after investing the amount for a number of years. The amount we will invest will be called the principal. The money that we will get is called the amount. The rate of interest we get will be called the annual rate of return. The term will be the number of years for which the principal amount is going to be invested.
1. Learn more about the internal rate of return here:
https://brainly.com/question/16752191
2. Learn more about the principal amount here:
https://brainly.com/question/25720319
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