137k views
2 votes
A savings account is started with an initial deposit of $750. The account earns 1.5% interest compounded annually (once per year). (a) Write an equation to represent the amount of money in the account as a function of time in years. (b) Find the amount of time (in years) it takes for the account balance to reach $1346.89. show your work

1 Answer

7 votes

Final answer:

An equation to represent the amount of money in the account is A = 750(1 + 0.015)^t.

In this case, it takes approximately 7.65 years for the account balance to reach $1346.89.

Step-by-step explanation:

To represent the amount of money in the savings account as a function of time in years, we can use the formula for compound interest: A = P(1 + r/n)^(nt). ( Where A is the amount in the account after time t, P is the initial deposit, r is the annual interest rate in decimal form, n is the number of times the interest is compounded per year, and t is the time in years).

In this case, the formula becomes: A = 750(1 + 0.015)^t.

To find the amount of time it takes for the account balance to reach $1346.89, we can set up the equation:

1346.89 = 750(1 + 0.015)^t.

Let's solve for t:

  • Divide both sides of the equation by 750: (1 + 0.015)^t = 1.79586
  • Take the logarithm (base 1+0.015) of both sides: t = log(1.79586) / log(1 + 0.015)
  • Calculating the logarithms, we find that t ≈ 7.65

So, it takes approximately 7.65 years for the account balance to reach $1346.89.

User Kyleus
by
7.6k points

No related questions found