00:01
This problem says you decide you want your child to be a millionaire.
00:04
You have a son today and you deposit $10 ,000 in an investment account that earns 7 % per year.
00:09
The money in the account will be distributed to your son whenever the total reaches $1 ,500 ,000.
00:15
How old will your son be when he gets the money rounded to the nearest year? and to figure this out, we'll use the simple interest formula where we have y equals a times 1 plus r raise to the t, where y is our final amount and we want to reach $1 ,500 ,000.
00:31
Equal to a, which is our initial amount, which was the $10 ,000 that we started with, times 1 plus r, and our rate was given as 7%, but in the formula we need to use the decimal representation, which would be 0 .07, so that's 1 plus 0 .07 or 1 .07 for our base, and then we raise to the t, which is what we're trying to find the time in years...