Solve the problem.
-If $\$ 18,000$ is put aside in a money market account with interest reinvested monthly at $2.3 \%$, find the time required for the account to earn $\$ 2,000$. Round to the nearest month. Use the model $A = P$ $\left( 1 + \frac { r } { n } \right) ^ { n t }$ where $A$ represents the future value of $P$ dollars invested at an interest rate $r$ compounded $n$ times per year for $t$ years.
A) 96 months
B) 5 months
C) 55 months
D) 97 months

Question

Quizplus · Accepted Answer

To find the time required, we use the formula $A = P \left( 1 + \frac{r}{n} \right)^{nt}$. Here, $A = 20000$, $P = 18000$, $r = 0.023$, and $n = 12$. Solving for $t$, we get $t \approx 4.58$ years, which is approximately 55 months when rounded to the nearest month.

Solve the Problem $18,000\$ 18,000$18,000 Is Put Aside in a Money Market Account with Interest

Solve the Problem $\$ 18,000$ Is Put Aside in a Money Market Account with Interest