find the time it will take for 5000 to mature to 25000 compounded annualy at 10% per annum

Question

ANNUITY FORMULAR ANSWERS LIKE FV OR PV OR PMT

Answer 1

Growth=25000/5000=5.

If r is the interest rate compounded annually, then r=10%=0.1, (1+r)^t=5, so 1.1^t=5, t=log(5)/log(1.1)=16.89 approx.

Since the amount is compounded annually, we need to work in whole years.

1.1¹⁷=5.0545, 1.1¹⁶=4.5950.

After 17 years, 5000 becomes 25,272.35; but after 16 years, 5000 becomes only 22,974.86, which falls short of target.

It would be necessary to wait 17 years to exceed 25,000.