Question

Tina wants to save money for school Tina invests $1,200 in an that pays an interest rate of 6.25%

How many years will it take for the account to reach $11,900? Round to the nearest hundredth.

Answer 1

37.84 years

Explanation:

We apply the compound interest formula;

A = P(1+r)^n

In this case we have;

A = 11,900

P = 1,200

r = 6.25% p.a

We substitute these values into the above equation and solve for n, the number of years required.

11900 = 1200(1.0625)^n

9.91667 = 1.0625^n

`n=(ln9.91667)/(ln1.0625)`

n = 37.84 years