Naomi invested $4,000 into a fund that is expected to grow by 5.53% per year. How long will it take the fund to be worth $8,000?
1 answer:
It will take 13.42 years.
The equation for this is in the form y=a(1+r)ˣ, where a is the initial deposit, r is the interest rate as a decimal number and x is the amount of time. Using our information, we have the equation
8000 = 4000(1+0.053)ˣ
8000 = 4000(1.053)ˣ
Divide both sides by 4000:
8000/4000 = 4000(1.053)ˣ/4000
2 = 1.053ˣ
We will use a logarithm to solve this:
The equation for this is in the form y=a(1+r)ˣ, where a is the initial deposit, r is the interest rate as a decimal number and x is the amount of time. Using our information, we have the equation
8000 = 4000(1+0.053)ˣ
8000 = 4000(1.053)ˣ
Divide both sides by 4000:
8000/4000 = 4000(1.053)ˣ/4000
2 = 1.053ˣ
We will use a logarithm to solve this:
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