Question
Asked Nov 8, 2019
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Find the time required for an investment of $3000 to grow to $5000 at an interest rate of 7.5% per year, compounded quarterly. (Round your answer to two decimal places.)
yr
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Find the time required for an investment of $3000 to grow to $5000 at an interest rate of 7.5% per year, compounded quarterly. (Round your answer to two decimal places.) yr

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Expert Answer

Step 1

According to the given information:

Principal (P) = $3000

Amount (A) = $5000

Rate of interest = 7.5% per annum

It is needed to calculate the time (t) when compounded quarterly.

Step 2

Formula to calculate the amount when compounded quarterly is:

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4t A P 1 4

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Step 3

Now, plug the values in the gi...

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4t 0.075 5000 30001 4 5 - (1+0.018) 1.67 (1.018) now taking log both sides: log (1.67) log (1.018)") => log(1.67) = 4tx log (1.018)) 0.2227 4t(0.0077) 0.2227 = 7.23years t = 4(0.0077)

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