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If you invest $3,900 at a 7.83% simple annual interest rate, approximately how long will it take for you to have a total of $10,000? a. 12 years b. 15 years c. 20 years d. 30 years please select the best answer from the choices provided a b c d



Answer :

Option c. 20 years is the correct answer. The $3900 investment will grow to $10000 over the course of 20 years.

Principal amount invested = $3900

Required amount = $10000

Amount of Interest required to be earned over the period= 10000-3900 = $6100

Rate of interest = 7.83% compounded annually

The number of years it will take the investment to attain the needed amount can be calculated using the simple interest formula as follows:

Simple interest = P*R*T/100

Simple interest = $6100

where P = principal amount invested

P = $3900

R = rate of interest

R = 7.83%

T = time in years

Substituting the values in the formula we get the following:

6100 = 3900*7.83*T/100

6100 = 305.37T

T = 19.97 or 20 years

So, it will take 20 years for the investment of $3900 to grow to $10000

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