SOLUTION: jimmy invest 16000 in an account that pays 8.13% compounded quarterly. How long(in years and months) will it take for his investment to reach 21000. Round the answer for months up

Question 1040131: jimmy invest 16000 in an account that pays 8.13% compounded quarterly. How long(in years and months) will it take for his investment to reach 21000. Round the answer for months up to the nearest multiple of 3
Answer by ankor@dixie-net.com(22740) (Show Source): You can put this solution on YOUR website!
jimmy invest 16000 in an account that pays 8.13% compounded quarterly.
How long(in years and months) will it take for his investment to reach 21000.
:
the compound interest formula
, where
A = the resulting amt after t yrs
P = initial amt
r = annual interest rate in decimal form
n = compounding periods per yr
t = no. of yrs
:
In the problem
A = 21000
p = 16000
n = 4 (time per yr)
r = .0813
t = yrs
:
= 21000
= 21000
= = 1.3125
Using logs
= log(1.3125)
log equiv of exponents
4t*log(1.020325) = log(1.3125)
4t =
use you calc
4t = 13.515
divide by 4
t = 3.379 yrs
find the no. of months
.379(12) = 4.54 months
Rounds up to 4 yrs 9 months
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