Question

Charmaine deposited $2000 into an account with a 3.9% annual interest rate, compounded quarterly. Assuming that no withdrawals are made, how long will it take for the investment to grow to $4000?

Answer 1

17 years & 9 months

Explanation:

annual rate 3.9%

every quarter = 3.9%/4 = 0.98%

compounding every quarter = (1+0.98%)

how long = assuming t quarters

2000 * (1+0.98%) ^t = 4000

solve for t

t= 71

so 71/4 = 17 years & 9 months