Answer: it will take 14 years
Step-by-step explanation:
A savings account is started with an initial deposit of $600. This means that the principal P is
P = 600
It was compounded annually. This means that it was compounded once in a year. Therefore,
n = 1
The rate at which the principal was compounded is 2.1%. So
r = 2.1/100 = 0.021
The duration of time that for which the money stayed in the account is t years. So
Time = t
The formula for compound interest is expressed as
A = P(1+r/n)^nt
Where
A = total amount in the account at the end of t years. Therefore,
a) the equation to represent the amount of money in the account as a function of time in years would be
A = 600 (1+0.021/1)^1×t
A = 600 (1.021)^t
b) the amount of time it takes for the account balance to reach $800 would be
800 = 600 (1.021)^t
Dividing both sides of the equation by 600, it becomes
1.33 = (1.021)^t
t = 14
