Hello
To solve this problem, we would use the formula of future value of an entity
[tex]\begin{gathered} fv=pv(1+r)^t \\ fv=\text{future value} \\ pv=\text{present value} \\ r=\text{rate} \\ t=\text{time} \end{gathered}[/tex]
So, we can proceed to identify and define our equation
[tex]\begin{gathered} pv=8,250 \\ fv=44,000 \\ t=20 \end{gathered}[/tex]
Let's substitute and solve for r
[tex]\begin{gathered} 44000=8250(1+r)^{20} \\ \frac{44000}{8250}=(1+r)^{20} \\ 5.3=(1+r)^{20} \\ \sqrt[20]{5.3}=1+r \\ r=\sqrt[20]{5.3}-1 \\ r=1.0869-1 \\ r=0.0869 \\ r=0.0869\times100 \\ r\approx8.7\text{ \%} \end{gathered}[/tex]
From the calculation above, the rate is approximately equal to 8.7%
