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For his birthday, Simon's parents gave him $4179.00 which they put into a savings account that earns 4.86% interest compounded quarterly. When Simon started university, he withdrew the entire balance of $4553.00 and used it to pay for tuition. How long was the money in the account? Round your answer to the nearest month.

 Jun 18, 2022
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4553.00==4179 x [1 +  0.0486/4]^N, solve for N

 

4553.00/4179.00 ==1.01215^N

 

1.0894950945 ==1.01215^N

Take the log of both sides

 

N==log(1.0894950945) / log(1.01215)

 

N ==7.09745 - Number of quarters on deposit

N ==7.09745 /4 ==1.7744 years - or about 1 year and 9+ months. 

 Jun 18, 2022

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