Suppose that 5000 is placed in a savings account at an annual rate of 4.2%, compounded monthly. Assuming that no withdrawals are made, how long will it take for the account to grow to 5650?

Solution

Solution

Time : 2.92

Solution steps

Translate the problem into an equation:

5650 = 5000 (1 + \frac{0.042}{12})^{12 t}

Solve for

t, 5650 = 5000 (1 + \frac{0.042}{12})^{12 t} : t = 2.92

Time : 2.92

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