You can afford monthly deposits of $270 into an account that pays 3.9% compounded monthly. How long will it be until you have $6,400 to buy a​ boat?

Question

You can afford monthly deposits of $270 into an account that pays 3.9% compounded monthly. How long will it be until you have $6,400 to buy a​ boat?

Type the number of​ months: ______

​(Round to the​ next-higher month if not​ exact.)

Answer 1

Ok so we know that we have $270 to put in monthly so that we get to 6400 dollars in order to buy a boat. So then We also have an account that pay compound interest on each deposit, so we have:

6400=270*(1+ .039/12)^12*t.

So then, we just have to solve for t. So first, we'll take the natural log of both sides, so we have:

ln(6400)=12*t*ln(270*1.00325):

Then we would solve for t. After that, we would divide t by 12, since t's default unit is year.

Thank you!