Question

Use the formula for compound interest, a P 1 i n = ^ h + , to determine how many years it will take for an investment of W10 000 to triple if the interest rate is 7% per year, compounded quarterly. [Hint: There is a yearly interest rate that is compounded quarterly. Search "interest calculator" online to check the answer

Answer 1

The money will be triple after 15 years and 303 days.

What is compound interest?

Compound interest, also known as interest on principal and interest, is the practice of adding interest to the principal amount of a loan or deposit.

Given:

Principle (P) = $10,000

The amount will be triple.

So, Amount (A) = $30,000

Rate (r) = 7% = 0.07

The interest is compounded quarterly.

n = 4

We have to find the value of t.

Let,

$A = P(1+\frac{r}{n})^n^t\\ 30000 = 10000(1+\frac{0.07}{4})^4^t\\\frac{30000}{10000} = (1 + 0.0175)^4^t\\ 3 = (1.0175)^4^t$

Apply logarithm on both sides,

$log(3) = log(1.0175)^4^t\\log(3) = 4t log(1.0175)\\t = \frac{log(3)}{4(log(1.0175))} \\t = \frac{0.4771212547}{4(0.0075344179)} \\t = \frac{0.4771212547}{0.0301376716} \\t = 15.83139$

Hence, the money will be triple after 15 years and 303 days.

To know more about compound interest, click on the link

brainly.com/question/24274034

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