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October 24, 2014

October 24, 2014

Posted by **catherine** on Sunday, September 2, 2012 at 2:34pm.

it will be awesome if you can put the way

- math -
**Henry**, Tuesday, September 4, 2012 at 8:52pmUse the maximum compounding frequency which is daily. This will minimize the time required to reach $10,000.

P = Po(1+r)^n.

P = $10,000.

Po = $5,000 = Initial deposit.

r = (7%/360) / 100%=0.0001944.= Monthly % rate expressed as a decimal.

n = The # of compounding periods.

5000(1.0001944)^n = 10000

Divide both sides by 5000:

(1.0001944)^n = 2

Take log of both sides:

n*Log(1.0001944) = Log2

n = Log2 / Log(1.0001944) = 3565 Compounding periods.

T = 3565comp. * iyr/360Comp = 9.9 yrs.

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