Question

You want to save ₹1,17,000 to buy your first self-driving magic carpet. You deposit ₹90,000 in a bank at an interest rate of 6\%6% per annum. How many years do you have to wait before you can buy your magic carpet?

Answer 1

Answer: He has to wait for 4.5 years to buy magic carpet

Step-by-step explanation:

Since we have given that

Amount she need to save to buy a first self driving magic carpet = $1,17,000

Amount she deposited (P) = $90000

Rate of interest (r)=6%

Let the number of years be 'n'

As we know the formula for "Compound Interest":

$A=P(1\frac{r}{100})^n\\\\117000=90000(1+\frac{6}{100})^n\\\\\frac{117000}{90000}=(1+0.06)^n\\\\1.3=(1.06)^n\\\\\text{Taking log both sides}\\\\\log1.3=n\times \log 1.06\\\\\frac{\log 1.3}{\log 10.6}=n\\\\n=4.5\ years$

Hence, he has to wait for 4.5 years to buy magic carpet.