mpf

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how long will it take for $ 500 to amount $700 of interested at $8% compounded quarterly?

  • mpf -

    Pt = Po(1+r)^n.

    r = (8% / 4) / 100% = 0.02 = Quarterly
    % rate expressed as a decimal.

    n = The # of compounding periods.

    Pt = $500(1.02)^n = $700.
    (1.02)^n = 700 / 500 = 1.40.
    n*Log(1.02) = Log(1.40).
    n = LOg(1.40) / Log(1.02) = 16.991.

    T = 16.991Comp. / 4Comp./yr=4.25 Yrs.

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