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Sagot :
The value of annual interest rate of the bank account is 5% using the compound interest formula. The account accumulates interest monthly.
What is compound interest?
Compound interest refers to Interest on interest, or is the adding of interest to the principal amount of a loan or deposit.
[tex]\rm\,A= P (\,1+ \dfrac{I}{n})^{nt}[/tex]
- Where 'A' is equal to the amount of investment after t years
- P is the principal amount
- 'r' is the interest rate
- 'n' is the number of times interest is getting compounded per year
- 't' is equal to the number of years.
In this case, to calculate the interest rate we will use the compound interest rate:
[tex]2,762.35 = 2,500 (1 + \dfrac{\rm\,r}{12})^{2\times12\\}\\\\ 1.105012 = (1+ \dfrac{\rm\,r}{12})^{24}\\\\\rm\,Take\, the\, 24th\, root:\\\\1.004169= 1+\dfrac{\rm\,r}{12}\\\\0.004169= \dfrac{\rm\,r}{12}\\\\r= 0.050028\\\\r= 5\%[/tex]
Hence, the value of annual interest rate using compound interest method is equal to 5%.
To learn more about compound interest, refer to the link:
https://brainly.com/question/24924853
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