SOLUTION: Ramesh earns 5% on a $7,500 investment compounded annually. How long will it take for the investment to reach $50,000?
Compound yearly formula: f(t) = a × (1+b)^t
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Compound yearly formula: f(t) = a × (1+b)^t
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Question 1182865: Ramesh earns 5% on a $7,500 investment compounded annually. How long will it take for the investment to reach $50,000?
Compound yearly formula: f(t) = a × (1+b)^t Answer by ikleyn(53937) (Show Source):
You can put this solution on YOUR website! .
Ramesh earns 5% on a $7,500 investment compounded annually. How long will it take for the investment to reach $50,000?
Compound yearly formula: f(t) = a × (1+b)^t
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So, what you need is to solve this inequality for time " t " in years
>= 50000.
It is equivalent to the inequality
>=
or
>= 6.66667
To solve it, take logarithm base 10 of both sides. You will get
t*log(1.05) >= log(6.66667),
or
t >= = use your calculator = 38.88 years.
You must round it to the closest greater integer number in order for the bank was in position to make the last compounding.
So your final ANSWER is 39 years.
