Provide a complete solution and answer for the given problem in the attached image. 29. If the future is 25% more than the principal after 8 months, determine thesimple interest rate.a. 26.34%b. 18.56%c.15.67%d. 37.5%*

In case of the simple interest the interest amount is computed only on the initial principal amount.…

Answered: 29. If the future is 25% more than the…

29. If the future is 25% more than the principal after 8 months, determine the simple interest rate. a. 26.34% b. 18.56% O O d. 37.5% c.15.67%

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Concept explainers

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.

Question

Provide a complete solution and answer for the given problem in the attached image.

29. If the future is 25% more than the principal after 8 months, determine the
simple interest rate.
a. 26.34%
b. 18.56%
c.15.67%
d. 37.5%
*

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