Question

You decide to put $2,000 in a savings account to save for a $3,000 down payment on a new car. If the account has an interest rate of 4% per year and is compounded monthly,

how long does it take until you have $3.000 without depositing any additional funds?

Answer 1

12.5 years = 216 months

Explanation:

4% of 2000= $80

1000/80=12.5

It will take 12.5 years to make $1000 on its own without adding additonal funds.