Question

$1500 were deposited into an account with a 6% interest rate, compounded quarterly. How many years was it in the bank if the current amount is $4936 ?

Answer 1

The money was in the bank for approximately 7.02 years.

Step-by-step explanation:

To find out how many years the money was in the bank, we can use the formula for compound interest: A = P(1 + r/n)^(nt), where A is the final amount, P is the principal amount, r is the interest rate, n is the number of times interest is compounded per year, and t is the number of years. In this case, we are given that the principal amount is $1500, the interest rate is 6% (or 0.06), and the final amount is $4936. We can plug these values into the formula and solve for t:

$4936 = $1500(1 + 0.06/4)^(4t)

Dividing both sides by $1500, we get:

3.2907 = (1 + 0.015)^(4t)

By taking the logarithm of both sides, we can isolate t:

t = 7.02 years