Suppose you deposit D dollars at the beginning of each month into an account that pays a monthly rate of r as a decimal. Then, the balance B of the account after t months is given by B = D(1 + r) (1 + r)t − 1 r dollars. Suppose you deposit $160 at the beginning of each month into an account that pays a monthly rate of r = 0.005, which corresponds to an APR of 6%. How long does it take for the account balance to build to $2600? Report your answer to the nearest whole month. months
Suppose you deposit D dollars at the beginning of each month into an account that pays a monthly rate of r as a decimal. Then, the balance B of the account after t months is given by B = D(1 + r) (1 + r)t − 1 r dollars. Suppose you deposit $160 at the beginning of each month into an account that pays a monthly rate of r = 0.005, which corresponds to an APR of 6%. How long does it take for the account balance to build to $2600? Report your answer to the nearest whole month. months
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 36P
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Question
Suppose you deposit D dollars at the beginning of each month into an account that pays a monthly rate of r as a decimal. Then, the balance B of the account after t months is given by
B = D(1 + r)
dollars.
(1 + r)t − 1 |
r |
Suppose you deposit $160 at the beginning of each month into an account that pays a monthly rate of
r = 0.005,
which corresponds to an APR of 6%. How long does it take for the account balance to build to $2600? Report your answer to the nearest whole month. months
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