Answered

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A person invests 7000 dollars in a bank. The bank pays 5.5% interest compounded
monthly. To the nearest tenth of a year, how long must the person leave the money
in the bank until it reaches 13200 dollars?

Sagot :

samuelonum1

The time required to get a total amount of $13,200.00 with compounded interest on a principal of $7,000.00 at an interest rate of 5.5% per year and compounded 12 times per year is 11.559 years. (about 11 years 7 months)

Answer:

t = 11.559 years

Compound Interest

Given Data

  • Principal P= $7000
  • Rate r= 5.5%
  • Final Amount A = $13200
  • Time t = ??

(about 11 years 7 months)

Calculation Steps:

First, convert R as a percent to r as a decimal

r = R/100

r = 5.5/100

r = 0.055 per year,

Then, solve the equation for t

t = ln(A/P) / n[ln(1 + r/n)]

t = ln(13,200.00/7,000.00) / ( 12 × [ln(1 + 0.055/12)] )

t = ln(13,200.00/7,000.00) / ( 12 × [ln(1 + 0.0045833333333333)] )

t = 11.559 years

Learn more about compound interest here:

https://brainly.com/question/24924853

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