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1) How much was the initial investment in dollars?

2) What is the account's value 6 years after initial investment?
3) How much interest has been earned after 8 years?
4) How many years will it take this account to triple? (I=800)​

1) How much was the initial investment in dollars? 2) What is the account's value-example-1
User Mogoman
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1 Answer

2 votes

1) The initial investment in dollars was E. $400.

2) The account's value 6 years after the initial investment is I. $592.

3) After 8 years, the total interest that has been earned is B. $256.

4) Given the interest rate as 8%, the account will triple in 14.275 years.

We can use an online finance calculator to compute the period of investment required for the account to triple.

I/Y (Interest per year) = 8%

PV (Present Value) = $400

PMT (Periodic Payment) = $0

FV (Future Value) = $1,200 ($400 x 3)

Results:

N (# of periods) = 14.275 years

Total Interest = $800.00

Thus, in 14.275 years, the account will triple from $400 to $1,200.

User Babybear
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