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R6 000 is invested using compound interest calculated every month, for 30 months. The total interest is R1 125. What is the monthly interest rate as a percent?
in Mathematics by Diamond (78,454 points) | 32 views

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Using formula for compound:

A = P( 1 + i/m )^(nm)

6000 + 1 125 = 6000(1 + i/12)^(30/12 x 12)

(6000 + 1 125)/6000   =  (1 + i/12)^(30/12 x 12)

[(6000 + 1 125)/6000]^(1/30)  =  (1 + i/12)

[(6000 + 1 125)/6000]^(1/30) - 1  =  i/12

[[(6000 + 1 125)/6000]^(1/30) - 1] x 12  =  i

                                               i = 0.0689...

                                                  = 6.89%

monthly rate = 6.89%/12 = 0.574%
by Diamond (44,036 points)

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