Answer: lt will take 28.09 years for the account value to reach $37800
Step-by-step explanation:
Hi, to answer this question we have to apply the compounded interest formula:
A = P (1 + r) t
Where:
A = Future value of investment (principal + interest)
P = Principal Amount
r = Annual Nominal Interest Rate (decimal form)
Replacing with the values given
37800= 9600 (1+0.05)^t
Solving for t (years)
37800/9600 = 1.05^t
3.9375 = 1.05^t
log 3.9375 = log 1.05^t
log 3.9375 = t (log 1.05)
log 3.9375/log 1.05 = t
t = 28.09 years
