Tara is saving money to buy her first car. She will need $20,000. She currently has $10,000 and can invest the money at 12% per year. In approximately how many years can she buy her car?

Question

Mathematics

Riley Mooney

20 May, 02:17

Tara is saving money to buy her first car. She will need $20,000. She currently has $10,000 and can invest the money at 12% per year. In approximately how many years can she buy her car?

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Answers (1)

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Heidy Banks · Answer 1

Answer: she can buy the car in approximately 8.3 years

Step-by-step explanation:

We would apply the formula for determining simple interest which is expressed as

I = PRT/100

Where

I represents interest on the amount invested.

P represents the principal or amount of money invested.

R represents interest rate

T represents the duration of the investment in years.

From the information given,

P = 10000

R = 12%

I = 20000 - 10000 = 10000

Therefore,

10000 = (10000 * 12 * T) / 100

10000 = 1200T

T = 10000/1200

T = 8.33 years