Question

How many years does it take for a deposit of $1000 to reach $2700 with an annual effective interest rate of 11.1%?

Answer 1

	Amount investment = $ 1000
	Interest rate per year = 11.1% per annum
	Period = 15 Years
	Years	Investment	Interest @ 11.1% Per Year	Running Bal
	1	$1,000.00	$111.00	$1,111.00
	2		$123.32	$1,234.32
	3		$137.01	$1,371.33
	4		$152.22	$1,523.55
	5		$169.11	$1,692.66
	6		$187.89	$1,880.55
	7		$208.74	$2,089.29
	8		$231.91	$2,321.20
	9		$257.65	$2,578.85
	10		$286.25	$2,865.11
	In the 10 th year we reach the $ 2700 but we not required whole 10th year
	So exact period calculaiton is as below,
	Amount required in the 10th year = $ 2865.11 - $ 2,700
	Amount required in the 10th year = $ 165.11
	So period required = $ 165.11 / $ 286.25
	So period required = 0.58 Years
	So , period required for reach $ 2,700 = 9.58 Years
	Answer = 9.58 Years