Question

Waiting period. Upstate University currently has a 6 comma 000 ​-car parking capacity for​ faculty, staff, and students. This​ year, the university issued 4 comma 356 parking passes. The number of parking passes issued has been growing at a rate of 6 ​% per year. How long will it be before the university will need to add parking​ spaces?

Answer 1

Answer: 5.5 years

Explanation:

The 6,000 parking capacity is the future value of the number of parking passes and the 4,356 is the present value.

Using the future value formula, you can find the number of periods it would take:

Future value = Present value * (1 + rate) ^ n

(1 + rate)^ n = Future value / Present value

n = In (Future value / Present value) / In ( 1 + r)

= In (6,000 / 4,356) / In ( 1 + 6%)

= 5.495 years

= 5.5 years