Question

In: Finance

An alternative to using logarithms to determine the amount of time that it would take for...

An alternative to using logarithms to determine the amount of time that it would take for a lump-sum investment at a particular compound interest rate to grow to a certain value would be to use a spreadsheet to list the value of the investment after each compounding period for as many times as is necessary. Suppose that you receive $1,000 as a gift and decide to invest it in a fund that pays a particular interest rate compounded quarterly. (6.91% compounded quarterly). Determine how long it will take for this investment to grow to $8,000 by showing the value of the investment after each compounding period. Include columns showing the period number, the length of time that has passed, and the amount in the account at the end of each period (you may want to include additional columns depending on your set-up). You may stop the process once you get to the first value for the amount in the account at the end of a period that is $8,000 or above.

Solutions

Expert Solution

Period Length of Time (in years) Amount
1 0.25 1017.275
2 0.5 1034.848426
3 0.75 1052.725432
4 1 1070.911264
5 1.25 1089.411256
6 1.5 1108.230836
7 1.75 1127.375523
8 2 1146.850935
9 2.25 1166.662785
10 2.5 1186.816885
11 2.75 1207.319147
12 3 1228.175585
13 3.25 1249.392318
14 3.5 1270.97557
15 3.75 1292.931673
16 4 1315.267068
17 4.25 1337.988307
18 4.5 1361.102055
19 4.75 1384.615093
20 5 1408.534318
21 5.25 1432.866749
22 5.5 1457.619522
23 5.75 1482.799899
24 6 1508.415267
25 6.25 1534.473141
26 6.5 1560.981165
27 6.75 1587.947114
28 7 1615.378901
29 7.25 1643.284571
30 7.5 1671.672312
31 7.75 1700.550451
32 8 1729.92746
33 8.25 1759.811957
34 8.5 1790.212709
35 8.75 1821.138633
36 9 1852.598803
37 9.25 1884.602447
38 9.5 1917.158955
39 9.75 1950.277876
40 10 1983.968926
41 10.25 2018.241989
42 10.5 2053.10712
43 10.75 2088.574545
44 11 2124.65467
45 11.25 2161.35808
46 11.5 2198.695541
47 11.75 2236.678006
48 12 2275.316619
49 12.25 2314.622713
50 12.5 2354.607821
51 12.75 2395.283671
52 13 2436.662196
53 13.25 2478.755535
54 13.5 2521.576037
55 13.75 2565.136263
56 14 2609.448992
57 14.25 2654.527224
58 14.5 2700.384181
59 14.75 2747.033318
60 15 2794.488319
61 15.25 2842.763104
62 15.5 2891.871837
63 15.75 2941.828923
64 16 2992.649018
65 16.25 3044.34703
66 16.5 3096.938124
67 16.75 3150.437731
68 17 3204.861542
69 17.25 3260.225525
70 17.5 3316.545921
71 17.75 3373.839252
72 18 3432.122325
73 18.25 3491.412238
74 18.5 3551.726385
75 18.75 3613.082458
76 19 3675.498458
77 19.25 3738.992694
78 19.5 3803.583792
79 19.75 3869.290702
80 20 3936.132699
81 20.25 4004.129392
82 20.5 4073.300727
83 20.75 4143.666997
84 21 4215.248844
85 21.25 4288.067268
86 21.5 4362.14363
87 21.75 4437.499661
88 22 4514.157468
89 22.25 4592.139538
90 22.5 4671.468749
91 22.75 4752.168371
92 23 4834.26208
93 23.25 4917.773957
94 23.5 5002.728503
95 23.75 5089.150637
96 24 5177.065715
97 24.25 5266.499525
98 24.5 5357.478304
99 24.75 5450.028742
100 25 5544.177988
101 25.25 5639.953663
102 25.5 5737.383863
103 25.75 5836.497169
104 26 5937.322657
105 26.25 6039.889906
106 26.5 6144.229005
107 26.75 6250.370561
108 27 6358.345712
109 27.25 6468.186134
110 27.5 6579.92405
111 27.75 6693.592238
112 28 6809.224044
113 28.25 6926.853389
114 28.5 7046.514781
115 28.75 7168.243324
116 29 7292.074727
117 29.25 7418.045318
118 29.5 7546.192051
119 29.75 7676.552519
120 30 7809.164964
121 30.25 7944.068288
122 30.5 8081.302068

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

Using either logarithms or a graphing​ calculator, find the time required for ​$5000 to be at...
Using either logarithms or a graphing​ calculator, find the time required for ​$5000 to be at least equal to ​$9000 when deposited at 5 ​% compounded monthly.
An airport shuttle service wants to determine the length of time it would take to transport...
An airport shuttle service wants to determine the length of time it would take to transport passengers from various locations to a major metropolitan airport during nonpeak hours. A sample of 16 trips on a particular day during nonpeak hours indicates the following: Distance (miles) Time (minutes) Distance (miles) Time (minutes) 35.0 29 15.7 41 19.5 35 18.4 27 25.4 70 20.2 37 27.0 55 21.8 36 10.3 19 24.3 40 11.6 18 30.3 21 16.1 23 9.2 20 14.3...
(A) Use logarithms to solve the problems. How long will it take $15,000 to grow to...
(A) Use logarithms to solve the problems. How long will it take $15,000 to grow to $18,000 if the investment earns interest at the rate of 5%/year compounded monthly? (Round your answer to two decimal places.) yr How long will it take an investment of $5000 to triple if the investment earns interest at the rate of 3%/year compounded daily? (Round your answer to two decimal places.) yr Find the interest rate needed for an investment of $3000 to double...
Using the rational method, determine the amount of runoff that would occur for a paved parking...
Using the rational method, determine the amount of runoff that would occur for a paved parking lot that is 100m * 50m and is uniformly sloped from one long edge to the other long edge at a rate of 2%. The time of concentration for this parking is 4 minutes. The five-year storm with duration of 4 minutes has an intensity of 10 mm/hr. The runoff coefficient for this parking lot is 0.80.آ [Q=0.166 CIA] The runoff from part (a)...
Using the rational method, determine the amount of runoff that would occur for a paved parking...
Using the rational method, determine the amount of runoff that would occur for a paved parking lot that is 100m * 50m and is uniformly sloped from one long edge to the other long edge at a rate of 2%. The time of concentration for this parking is 4 minutes. The five-year storm with duration of 4 minutes has an intensity of 10 mm/hr. The runoff coefficient for this parking lot is 0.80.آ [Q=0.166 CIA] The runoff from part (a)...
Does it take a different amount of time for seeds to germinate if they are near...
Does it take a different amount of time for seeds to germinate if they are near rock music that is continuously playing compared to being near classical music? The 53 seeds that were exposed to rock music took an average of 28 days to germinate. The standard deviation was 11 days. The 40 seeds that were exposed to classical music took an average of 32 days to germinate. The standard deviation for these seeds was 11 days. What can be...
The rule of 70 (which provides an estimate of the amount of time it will take...
The rule of 70 (which provides an estimate of the amount of time it will take for some variable, like money holdings to double) can show us how during a drastic inflation a. money’s usefulness as a store of value is destroyed. b. the relative value of products falls as inflation continues. c. the relative value of products change. d. the amount of money in everyone's bank accounts will double.
a. Determine the amount of heat needed to take a 34.5gram piece of ice (ΔHfus =...
a. Determine the amount of heat needed to take a 34.5gram piece of ice (ΔHfus = 6.02 kJ/mol) to 32.0 oC liquid water. b.Determine the amount of heat release when 465.3g of 100.0oC steam condenses to 21oC liquid water. (100.0oC ΔHvap= 40.6 kJ/mol)
The amount of time runners take to run a marathon is believed to be uniformly distributed...
The amount of time runners take to run a marathon is believed to be uniformly distributed after running for four hours. The following is the observed number of runners and the length of time it takes to cross the finish line. Carry out the Chi Square Goodness of fit test. Hypothesis: Calculation: Find each expected count and find each chi square value, total value and pvalue. 4-4.5 hours 4.5-5 hours 5-5.5 hours 5.5-6 hours 6-6.5 hours 6.5 + hours Total...
A scooter company wants to determine the average amount of time it takes an adult to...
A scooter company wants to determine the average amount of time it takes an adult to assemble an “easy to assemble” scooter. A sample of 49 times yielded an average time of 18.15 minutes. Assume that the assembly times are normally distributed and the population has a standard deviation of 5.39 minutes. a) Give a point estimate for the population mean that the sample of data is taken from. b) Find the 96% confidence interval for the mean assembly time.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT