Hank made payments of $187 per month at the end of each month for 30 years to purchase a piece of property. He promptly sold it for $172,787. What annual interest rate would he need to earn on an ordinary annuity for a comparable rate of return?
We are given with A = 187 per month n = 30 years F = 172787
What is asked is i The formula is A = Fi / (1 + i)^n Substituting 187 = 172787 i (1 + i)^(30x12) Solve for i and convert to effective annual interest rate
