Question

Solve for the unknown number of years in each of the following: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
		Present Value Years Interest Rate Future Value $1,000 9 % $1,855 2,691 7 4,450 34,305 12 394,620 34,000 19 220,892

Answer 1

1.Information provided:

Future value= $1,855

Current price= present value= $1,000

Interest rate= 9%

The number of years is calculated by entering the below in a financial calculator:

FV= 1,855

PV= -1,000

I/Y= 9

Press the CPT key and N to compute the number of years.

The value obtained is 7.1699.

Therefore, the number of years is 7.17 years.

2.Information provided:

Future value= $4,450

Current price= present value= $2,691

Interest rate= 7%

The number of years is calculated by entering the below in a financial calculator:

FV= 4,450

PV= -2,691

I/Y= 7

Press the CPT key and N to compute the number of years.

The value obtained is 7.4342.

Therefore, the number of years is 7.43 years.

3. Information provided:

Future value= $394,620

Current price= present value= $34,302

Interest rate= 12%

The number of years is calculated by entering the below in a financial calculator:

FV= 394,620

PV= -34,302

I/Y= 12

Press the CPT key and N to compute the number of years.

The value obtained is 21.5543.

Therefore, the number of years is 21.55 years.

4.Information provided:

Future value= $220,892

Current price= present value= $34,000

Interest rate= 19%

The number of years is calculated by entering the below in a financial calculator:

FV= 220,892

PV= -34,000

I/Y= 19

Press the CPT key and N to compute the number of years.

The value obtained is 10.7576

Therefore, the number of years is 10.76 years.

In case of any query, kindly comment on the solution.