Question

How long will it take for $5,000 to grow to $17,000 at 7% annual interest? State your answer in years (rounded to the nearest tenth of a year, meaning 3.12 years would be entered as 3.1 for example).

Answer 1

Answer:

After 18 year amount will become $17000

Explanation:

We have given principal amount P = $5000

And future value of the investment A = $170000

Rate of interest r = 7 %

We have to find the time period n in which amount become $170000

We know that future value is given by

$A=P(1+\frac{r}{100})^n$

$17000=5000(1+\frac{7}{100})^n$

$3.4=1.07^n$

Taking log both side

$log3.4=nlog1.07$

$n\times 0.0293=0.5314$

n = 18 year

So after 18 year at the rate of 7 % amount $5000 will become $17000

So answer will be 18 year