SOLUTION: Becky would like to have at least $100,000 saved for her daughter's college education. If she invests $25,000 in an education account paying 6/25% interest compounded quarterly, w
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Question 1086142: Becky would like to have at least $100,000 saved for her daughter's college education. If she invests $25,000 in an education account paying 6/25% interest compounded quarterly, will she reach her goal in 16 years? Answer by Boreal(15235) (Show Source):
You can put this solution on YOUR website! No, because the rule of 72 says that with 6% interest, it would take 12 years for money to double and 24 years for it to increase 4-fold
25000(1+(.0625/4))^64=$67,433.62
The exact time for $100000 is
4=(1.015625)^t
ln4=t ln (1.015625)
t=89.41
That is quarterly compounding number
almost 22 1/2 years.
