Question

I deposited $4,000 into an account that earns 5% interest each year. the growth of my investment can be expressed by the exponential equation A= 4000 (1 + 0.5) where is the amount in the account after t years. in how many years will my account exceed $10,000?

Answer 1

We set up the equation 4000*1.05^t>10000. Dividing by 4000, we seek to find t such that 1.05^5>2.5. A calculator gives t>18.78, however, since interest is compounded yearly, we want a whole number of years. The smallest whole number greater than 18.78 is 19.