Question

Taylor's parents put $5,000 into college savings account that pays 5% simple interest. If the current balance is $8,500, about how many years has it been in the account?

Answer 1

14 years

Explanation:

To find the answer, you have to use the formula to calculate the time period:

t=(1/r)*(A/P-1), where:

t= time period

r= rate of interest=5%

A= accrued amount=$8,500

P= principal amount=$5,000

Now, you can replace the values in the formula:

t=(1/0.05)*(8,500/5,000-1)

t=20*0.7

t=14

According to this, the answer is that the money has been 14 years in the account.