Bob bought some land costing $15,390. Today, that same land is valued at $44,817. How long has Bob owned this land if the price

Question

3 years ago

14

of land has been increasing at 5 percent per year?

1 answer:

Natalka [10] · Answer 1 · 2022-06-30T09:59:30+03:00

Answer:

Bob bought the land 21 years and 332 days ago.

Explanation:

Giving the following information:

Bob bought some land costing $15,390. Today, that same land is valued at $44,817.

To calculate the number of years passed we need to use a variation of the Future Value formula:

FV=PV*(1+i)^n

Isolating n:

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

n= [ln(44,817/15,390) / ln(1.05)]

n= 21.91

0.91*365= 332

Bob bought the land 21 years and 332 days ago.