Question 154536: How long would it take for $100 to become $1000 if it is invested at an 8% annual interest rate that is compounded quarterly? Answer by AnlytcPhil(1806) (Show Source):
You can put this solution on YOUR website! How long would it take for $100 to become $1000 if it is invested at an 8% annual interest rate that is compounded quarterly?
where P = beginning amount = 100
A = final amount = 1000
r = rate expressed as a decimal = .08
n = 4 (quarterly means compounded 4 times a year)
t = ? (number of years, the unknown)
Divide both sides by 100
Take logs of both sides:
Use the rule of logs:
Divide both sides by (4*log(1.02))
29.06918686 years.
Edwin
