Question

Suppose you deposit $1500 in a savings account that pays interest at an annual rate of 6% if no money is added or withdrawn from the account answer the following questions how much will be in the account in four years how much will be in the account after 16 years how many years will it take for the account to contain $2000 How many years will it take for the account to contain $2500

Answer 1

Answer:

In 4 years = $1,893.72

In 16 years = $3,810.53

years to contain $2,000 = 4.9371454128

years to contain $2,500 = 8.766692911

Step-by-step explanation:

In 4 years

A = 1,500 (1 + 0.06)^4

  = $1,893.72

In 16 years

A = 1,500 (1 + 0.06)^16

   = $3, 810.53

to find number of years

t = ln (A/P) / ln (1+r)

when A = 2,000

t = ln(2,000/1,500) / ln(1+0.06)

 = 4.9371454128 years

when A = 2,500

t = ln(2,500/1,500) / ln(1+0.06)

 = 8.766692911 years

PS: You can also use log in place of ln