How many years will it take an ordinary annuity consisting of regular payments of $65 earning 9.1% per year compounded monthly to grow to 1,275.40? Round your answer to 2 decimal places.
answer i got : 1.47 years
I am not sure why or what am i doing wrong but i cannnt seem to get it right !!!!
answer i got : 1.47 years
I am not sure why or what am i doing wrong but i cannnt seem to get it right !!!!
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adjusting for periodicity, r = 0.091/12, and counting n in months,
FV = PMT((1+r)^n - 1) / r
FV/PMT = 1275.40/65 = ((1+0.091/12)^n - 1)/(0.091/12)
(1+0.091/12)^n - 1 = .1488
(1+0.091/12)^n = 1.1488
n = ln 1.1488 / ln (1 +0.091/12) = 18.36 months, 1.53 years <--------
you may have rounded off intermediate values
FV = PMT((1+r)^n - 1) / r
FV/PMT = 1275.40/65 = ((1+0.091/12)^n - 1)/(0.091/12)
(1+0.091/12)^n - 1 = .1488
(1+0.091/12)^n = 1.1488
n = ln 1.1488 / ln (1 +0.091/12) = 18.36 months, 1.53 years <--------
you may have rounded off intermediate values