Question: At what rate must $400 be compounded annually for it to grow to $900.88 in 12 years? Submit your answer as a percentage and round

At what rate must $400 be compounded annually for it to grow to $900.88 in 12 years? Submit your answer as a percentage and round to two decimal places.

Please answer with the following steps:

(i) Develop the timeline (linear representation of the timing of cashflows)

(ii) Identify the time value of money variable (PV, FV, PMT, N or Rate) which needs to be calculated in the question.

(iii) Identify the values of the remaining four variables (PV, FV, PMT, N or Rate) from the question. Be sure to input positive or negative signs.

(iv) Calculate the correct value of the variable identified in step (ii).

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