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MATH HELP

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Derrick is investing $1,000 at 5% interest and Anna is investing $750 at 7% interest. Both interest rates are compounded annually. When will they have the same amount saved? (Hint: 1.05t/1.07t =(1.05/1.07)t )

  • MATH HELP -

    we want

    1000*1.05^t = 750*1.07^t
    (1.05/1.07)^t = 3/4
    .9813^t = .75
    t = log(.75)/log(.9813) = 15.24 years

    Extra credit: after that point, who gets the larger amount?

  • MATH HELP -

    calculate the compound interest on an investment of $18,000 at 8%, interest compounded quarterly, for 15 months.

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