Question

A person invests 3000 dollars in a bank. The bank pays 6% interest compounded quarterly. To the nearest tenth of a year, how long must the person leave the money in the bank until it reaches 7700 dollars?

Answer 1

16 years approx

Explanation:

Given data

P=$3000

r= 6%

A= $7700

t= ??

The compound interest formula is

A= P(1+r)^t

Calculate time, solve for t

t = ln(A/P) / r

substitute

t= ln(7700/3000)/0.06

t= ln(2.566)/0.06

t= 0.942/0.06

t= 15.7

The time is 16 years approx