Question

A person invests $350 in an account that earns 3.65% annual interest compounded

semiannually. Find when the value of the investment reaches $5675.

Answer 1

Approximately 77 years

Explanation:

V(t)=P(1+r/n)^nt

5675=350(1+.0365/2)^2t

16.214=1.01825^2t

log16.214=log1.01825^2t

log16.214=2t(log1.01825)

log16.214/2log1.01825=t

77=t

Answer 2

M = C(1+r)^t

5675 = 350(1+0.0365/2)^t

5675=350×1.01825^t

t = 154.04