Question 930789: A loan of $37,000 is made at 5.5% interest, compounded annually. After how many years will the amount due reach $62,000 or more? (Use the calculator provided if necessary.)Write the smallest possible whole number answer
Answer by lwsshak3(11628)   (Show Source):
You can put this solution on YOUR website! A loan of $37,000 is made at 5.5% interest, compounded annually. After how many years will the amount due reach $62,000 or more? (Use the calculator provided if necessary.)Write the smallest possible whole number answer
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Compound Interest Formula:
A=P(1+r/n)^nt, P=initial investment, r=annual interest rate,n=number of compounding periods per year, A=amount after t years
For given problem:
P=37000
r=5.5%=.055
n=1
A=62000
..
62000=37000(1+.055)^t
62/37=1.055^t
tlog(1.055)=log(62/37)
Using log keys on calculator:
t=log(62/37)/log(1.055)≈10 yrs
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