Answer:
She need a interest rate of 6.25%
Step-by-step explanation:
we know that
The simple interest formula is equal to
[tex]A=P(1+rt)[/tex]
where
A is the Final Investment Value
P is the Principal amount of money to be invested
r is the rate of interest
t is Number of Time Periods
in this problem we have
[tex]t=16\ years\\ P=\£8,000\\ A=\£8,000*2=\£16,000\\r=?[/tex]
substitute in the formula above and solve for r
[tex]16,000=8,000(1+16r)[/tex]
[tex]16r=2-1[/tex]
[tex]r=1/16[/tex]
[tex]r=0.0625[/tex]
Convert to percentage
[tex]r=0.0625*100=6.25\%[/tex]
