Answer:
8 years
Explanation:
For a compound interest loan compounded annually, the amount due after t years is calculated using the formula:
[tex]A(t)=P(1+r)^t\text{ where }\begin{cases}P={Loan\;Amount} \\ {r=Annual\;Interest\;Rate}\end{cases}[/tex]We want to find when the amount due will reach $64,000 or more.
[tex]43000(1+0.0525)^t\geq64,000[/tex]The equation is solved for t:
[tex]\begin{gathered} \text{ Divide both sides by }43000 \\ \frac{43,000(1+0.0525)^t}{43000}\geqslant\frac{64,000}{43000} \\ (1.0525)^t\geq\frac{64}{43} \\ \text{Take the log of both sides:} \\ \log(1.0525)^t\geqslant\log(\frac{64}{43}) \\ \text{By the power law of logarithm:} \\ \implies t\operatorname{\log}(1.0525)\geq\operatorname{\log}(\frac{64}{43}) \\ \text{ Divide both sides by }\operatorname{\log}(1.0525) \\ t\geq\frac{\operatorname{\log}(\frac{64}{43})}{\operatorname{\log}(1.0525)} \\ t\geq7.77 \end{gathered}[/tex]The number of years when the amount due will reach $64,000 or more is 8 years.
