The time required to get a total amount of $1,000,000.00 with compounded interest on a principal of $5,000.00 at an interest rate of 10% per year and compounded 1 times per year is 55.59 years.
<h3>Given data</h3>
Principal = $5,000
Rate = 10%
Final Amount A= $1,000,000
Time = ?
First, convert R as a percent to r as a decimal
r = R/100
r = 10/100
r = 0.1 per year,
Then, solve the equation for t
t = ln(A/P) / n[ln(1 + r/n)]
t = ln(1,000,000.00/5,000.00) / ( 1 × [ln(1 + 0.1/1)] )
t = ln(1,000,000.00/5,000.00) / ( 1 × [ln(1 + 0.1)] )
t = 55.59 years
(about 55 years 7 months)
Learn more about compounding interest at:
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