You decide to put $175 in a savings account to save for a $3000 down payment on a new car. If the account has an interest rate of 3% per year and is compounded monthly, how long does it take you to earn $3000 without depositing any additional funds?
94.8 years! Or 1138 months. Note: at 3% it takes about 24 months to doubles someone's money. Happy Valentines Day!! >u<
Answer:
hence, time of investment to get $ 3000 will be 1138 months.
Step-by-step explanation:
given,
money put in account = $ 175
down payment of car = $ 3000
rate of interest = 3%
as it is compounded monthly so, r = 3/12 = 0.25%
we now
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taking log both side
ln (17.143) = t ln (1.0025)
t = 1138 months or 95 years (approximately)
hence, time of investment to get $ 3000 will be 1138 months.