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George Bennet wants to give his son $20,000 upon completion of his college education. If he invests $5,500 now in an account earning 9% annual interest, approximately how many years will it take for him to achieve his goal

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facundobuzzetti

Answer:

It will take 16.09 years.

Explanation:

Giving the following information:

Future value= $20,000

Present value= $5,000

Interest rate= 9%

To calculate the number of years required to reach the objective, we need to use the following formula:

n= ln(FV/PV) / ln(1+i)  

n= ln(20,000 / 5,000) / ln(1.09)

n= 16.09

It will take 16.09 years.