SOLUTION: Bob has $8300.00 he invests at a rate of 6.2% interest per year compounded quarterly.
a) How much does Bob have after 3 and 1/2 years ?
b) How long will it take for Bob's investm
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Question 1096088: Bob has $8300.00 he invests at a rate of 6.2% interest per year compounded quarterly.
a) How much does Bob have after 3 and 1/2 years ?
b) How long will it take for Bob's investment to reach $15,000.00 ?
Answer by VFBundy(438) (Show Source): You can put this solution on YOUR website!
This is the formula for compound interest:
N is the new amount.
P is the principal amount.
r is the annual interest rate.
n is how often the interest is compounded per year.
t is the number of years.
a) How much does Bob have after 3 and 1/2 years ?
= $10,294.31
--------------------------------------------
b) How long will it take for Bob's investment to reach $15,000.00 ?
Divide each side of the equation by 8300:
Simplify the stuff inside the parenthesis:
Convert this to log form:
log 1.8072 base 1.0155 = 4t
Compute log 1.8072 base 1.0155:
38.4744 = 4t
Solve for t:
t = 9.6186
It will take 9.6186 years for Bob's investment to reach $15,000.
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