Question

Item 35Item 35 You expect to receive $4,100 upon your graduation and will invest your windfall at an interest rate of 0.63 percent per quarter until the account is worth $5,500. How many years do you have to wait until you reach your target account value

Answer 1

It will take 11.7 years to reach the objective

Step-by-step explanation:

Giving the following information:

PV= $4,100

FV= $5,500

i= 0.0063

n= ?

To calculate the time required to reach the future value, we need to use the following formula:

n= ln(FV/PV) / ln(1+i)

n= ln(5,500/4,100) / ln(1.0063)

n= 46.78

in years= 46.78/4= 11.70

It will take 11.7 years to reach the objective