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Calculate the interest rate necessary on the investment

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Question - You need to have $10,000 in 8 years in order to make a down-payment on a house. You currently have $6,000. Your bank offers you an investment with a guaranteed 7.5% interest rate (compounded annually)

a) Calculate the future value of your $6000 to show whether or not you will have enough money for the down-payment. Show calculations and whether you will have enough money?

b) Calculate the interest rate necessary on the investment for you to have $10000 in 8 years. Show calculations and would accept the investment?

Reference no: EM132952988

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