Question

If an amount of $25,000 is deposited into a saving account at an interest rate 4%, compounded semi-annually, how long will it take to accumulate on this account $28,500? The function describing your balance is M(n) =25,000(1+0.04/2)^2n, where n is time in years. 20 points and WILL GIVE BRAINLIEST!

Answer 1

It will take 3.3 years to accumulate $28,500  on this account

According to the compound amount formula expressed as:

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

P is the principal = $25,000

A is the amount = $28,500

r is the rate in decimal = 4% = 0.04

n = 2 (semi annualy)

Substitute the given parameters into the formula as shown:

$28,500=25,000(1+\frac{0.04}{2} )^{2t}\\1.14=(1+0.02)^{2t}\\1.14 = (1.02)^{2t}\\ln1.14 = 2tln1.02\\2t=\frac{ln1.14}{ln1.02}\\2t= \frac{0.13103}{0.01980}\\2t= 6.6177\\t = 3.30yrs$

Hence it will take 3.3 years to accumulate $28,500  on this account

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