## anonymous one year ago FAN AND MEDAL: You decide to put $150 in a savings account to save for a$3,000 down payment on a new car. If the account has an interest rate of 2.5% per year and is compounded monthly, how long does it take you to earn \$3,000 without depositing any additional funds? 10.1101 years 119.954 years 121.321 years 134.34 years

1. anonymous

So how do we plug them in?

2. Kash_TheSmartGuy

Sorry, never mind, I was wrong

3. anonymous

How do I do this then? :(

4. Kash_TheSmartGuy

Here- this is the formula for compound interest. A = P (1 + r/n) ^ nt

5. anonymous

So how do I plug in the values?

6. Kash_TheSmartGuy

7. Kash_TheSmartGuy

Sorry for the mistakes. I'm new to the topic!

8. anonymous

A=0.1325^12(t) right?

9. Kash_TheSmartGuy

How did you get that?

10. Kash_TheSmartGuy

@jim_thompson5910

11. anonymous

@Hero

12. anonymous

@Kash_TheSmartGuy I think I did it wrong the answer is A right>

13. jim_thompson5910

$\Large FV = PV*\left(1+\frac{r}{n}\right)^{n*t}$ $\Large 3000 = 150*\left(1+\frac{0.025}{12}\right)^{12*t}$ solve for t

14. Kash_TheSmartGuy

No idea! Completely new ti the topic.

15. anonymous

Can someone take me step bty step I dont know how to solve for t

16. Kash_TheSmartGuy

Ok now I know it..

17. Kash_TheSmartGuy

First solve the brackets.. division first. Divide 0.025 by 12

18. anonymous

480

19. Kash_TheSmartGuy

What? No, it's 0.00208333333

20. Kash_TheSmartGuy

21. Kash_TheSmartGuy

That would be 1.00208333333

22. anonymous

Oh my bad, I did 12/0.025 okay so what is the next step?

23. anonymous

@Kash_TheSmartGuy

24. Kash_TheSmartGuy

@alexistheking777 , sorry for that.

25. Kash_TheSmartGuy

3000=150*1.00208333333*12^t

26. Kash_TheSmartGuy

Can you do it yourself?