Question

you currently have $5,300 (present value) in an account that has an interest rate of 4.5% per year compounded quarterly (4 times per year). You want to withdrawl all your money when it reaches $10,600 (future value) in how many years will you be able to withdraw all your money? round your answer to 1 decimal place

Answer 1

the present value $5300 let after t years . reaches $ 10,000 4t quarter so time interest = 4.5 4. per quarterly interest rate 1.185% per quarterly n so A=plit 2 Ico whir A = futur value 8= interest rate n= time As present vallee to 10,600 5300 1+ 1.125 147 100 125 jat

-) 2 = (1.01125347 taking log on both sides 4+ log (1.01125) log2 it 2 TV 4 10g (1.01125) t=15.489 so t=1565 years withdraw the money. so .15. years