Originally Posted by
Zanhook
Calculating the number of payments:
Your're prepared to make monthly payments of 125, beginning at the end of this month, into an account that pays 10% intrest compnounded monthly. How many payments will you have made when your account balance reaches 20,000. I know you solve for t but I get stuck on what to do when I get to here...
16= 1-1/(1.1)`t
FV = A x [ (1+r)^n / r ] – 1
20,000 = 125 x [1.1^n/0.1 ] – 1
20,001 = 125 x [1.1^n/0.1 ]
160.008 = 1.1^n / 0.1
16.0008 = 1.1^n
n = log 16.0008 / log 1.1
n = 29.09
Therefore, it will take about 29-30 payments periods to reach $20,000