Your Friend Claims That He Invested $5,000 Seven Years Ago

Multiple Choice

Your friend claims that he invested $5,000 seven years ago and that this investment is worth $38,700 today.For this to be true,what annual rate of return did he have to earn? Assume the interest compounds annually.

A) 28.87 percent
B) 31.39 percent
C) 33.96 percent
D) 36.01 percent
E) 37.87 percent