Question

7400 dollars is placed in an account with an annual interest rate of 7%. To the nearest

Answer 1

Answer:

23.4 years.

Step-by-step explanation:

7400 dollars is placed in an account with an annual interest rate of 7%.

Now, let us assume that the interest is compounded annually and it will take x years for account value to reach 36000 dollars.

Hence, from the formula of compound interest, we can write that

$36000 = 7400(1 + \frac{7}{100})^{x}$

⇒ $(1.07)^{x} = 4.865$

Taking ln both sides we get,

x ln (1.07) = ln (4.865)

⇒ x = 23.4 years.