Question

Suppose that an investment of $13,000 has grown in value at a rate of 9% per year. If the current value is $16,835.38, then how many years have passed?

Answer 1

You need to use the formula

\(F = P(1 + r)^t\)

where F = future value,
P = present value
r = interest rate, and
t = time in years.

First, copy the formula. Then rewrite the formula with all the known amounts substituted in. The only unknown is t. Then solve for t. Since t is an exponent, you need to use logarithms.