Aubree invested 4,400 in an account paying an interest rate of 2.4% compounded quarterly. Assuming no deposits or withdrawals are made, how long would it take, to the nearest tenth of a year, for the value of the account to reach 6,880?

Solution

Aubree invested 4, 400 in an account paying an interest rate of 2.4% compounded quarterly. Assuming no deposits or withdrawals are made, how long would it take, to the nearest tenth of a year, for the value of the account to reach 6, 880?

Solution

Time : 18.68

Solution steps

Translate the problem into an equation:

6880 = 4400 (1 + \frac{0.024}{4})^{4 t}

Solve for

t, 6880 = 4400 (1 + \frac{0.024}{4})^{4 t} : t = 18.68

Time : 18.68

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