Question

Kurt has put $2,000 into a savings account that pays 6% annual interest

How much will his account be worth at 10 years? Show the equation you would need to write.

When will his account be worth $4,000?

Answer 1

Hi there
Part A
The formula is
A=p (1+r)^t
A future value?
P present value 2000
R interest rate 0.06
T time 10 years
So
A=2,000×(1+0.06)^(10)
A=3,581.7

Part b
4000=2000 (1.06)^t
Solve for t
4000/2000=1.06^t
Log (4000/2000)=t×log (1.06)
T=log(4,000÷2,000)÷log(1.06)
T=11.9 years round your answer to get
T=12 years

Hope it helps