Question

$4,000 is invested in an account earning 6.5% interest compounded annually. How many years did it take to reach $5,000? A. 2 years B. 3 years C. 4 years D. 5 years

Answer 1

The formula is
A=p (1+r)^t
A future value 5000
P present value 4000
R interest rate 0.065
T time. ?
5000=4000 (1+0.065)^t
Solve for t
Divide both sides by 4000
5000/4000=1.065^t
Take the log for both sides
Log (5000/4000)=t×log (1.065)
Divide both sides by log (1.065)
T=log(5,000÷4,000)÷log(1.065)
T=3.5 years round your answer to get 4 years

So the answer is c
Hope it helps!