Answer:
The time period is 13 years.
Step-by-step explanation:
Interest rate (r )= 5% or 5%/12 = 0.42% per months
The investment amount (Present value) = $10500
Final expected amount (future value) = $20000
Since we have given the initial amount and final amount. Therefore we have to calculate the time period for which the initial amount is kept in the bank.
Use the below formula to find the time period.
Future value = present value (1 + r )^n
20000 = 10500(1+0.0042)^n
1.9047619 = (1+0.0042)^n
1.9047619 = 1.0042^n
n = 153.74 months.
Time in years = 153.74 / 12 = 12.8 years or 13 years (round off)
