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18 February, 00:18

A principle of $3600 is invested at 7.75% interest, compound annually. How many years will it take to accumulate $10,000 or more in the account?

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  1. 18 February, 01:35
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    It would take 14 years for the account to accumulate over $10000.

    Step-by-step explanation:

    To work this out, you need to turn the 7.75% annual interest into a multiplier, which is 1.0775

    To work out the years taken, start with an estimate, such as 15 years

    $3600 x 1.0775^15 = $11029.65

    Despite this going over $10000, you need to find out the exact year it surpasses the amount, so I lowered the amount of years to 13 and 14 to see which year it goes past $10000

    $3600 x 1.0775^13 = $9500.08

    Since after 13 years it hadn't gone past $10000, I knew that the exact year was year 14

    $3600 x 1.0775^14 = $10236.33
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