How long will it take an investment of $25,000 at 6% compounded annually to accumulate to a total of $35,462.50?
A)4 years
B)5 years
C)6 years
D)2 years
E)10 years

Question

Quizplus · Accepted Answer

Present Value = Future Value * Interest Factor
$25,000 = $35,462.50 * Interest Factor; Interest Factor = 0.7050
0.7050 is the interest factor on the Present Value table; i = 6%; n = 6
Or, Alternative Solution: Future Value = Present Value * Interest Factor
$35,462.50 = $25,000 * Interest Factor; Interest Factor = 1.4185
1.4185 is the interest factor on the Future Value table; i = 6%; n = 6

How Long Will It Take an Investment of $25,000 at 6