Your father spent all of his adult life working in a small T-shirt making firm. His first year of sales was $118,000 and his last year of sales was $450,000. If the firm grew at an average rate of 3.15% per year, how many years did your father sell T-shirts in his firm?
A) 43.16 years
B) 40.00 years
C) 31.68 years
D) 25.91 years

Question

Quizplus · Accepted Answer

The correct answer is A.The formula for compound interest is:A = P(1 + r/n)^(nt)where:A is the final amountP is the principal (initial amount)r is the annual interest raten is the number of times per year that the interest is compoundedt is the number of yearsIn this case, we have:P = $118,000A = $450,000r = 3.15% = 0.0315n = 1 (compounded annually)t = ?Solving for t, we get:t = log(A/P) / log(1 + r/n)= log(450000/118000) / log(1 + 0.0315/1)= 43.16 yearsTherefore, your father sold T-shirts in his firm for 43.16 years.

Your Father Spent All of His Adult Life Working in a Small