A sum of N$2 500 was deposited in a venture account, which pays 12% compounded per year and it accumulated to N$3 950. Calculate the number of years the amount has been in the venture account. Answer must be rounded to the nearest unit?

Compound interest is the interest on a loan or deposit calculated based on the initial principal and the accumulated interest from the previous period.

A sum of $2,500 was deposited in a venture account, which pays 12% compounded per year and it accumulated to $3,950.

Then the number of the years will be

We know the compound interest formula

[tex]\rm A = P(1+r)^t[/tex]

where

A = Accumulated amount

P = Deposited value

r = rate of interest

t = time

Then we have

[tex]3950 = 2500 (1.12)^t\\\\1.58\ =1.12^t[/tex]

Taking log both sides, then we have

[tex]\rm \ln 1.58 = t \times \ln 1.12\\\\or \ \ \ \ t = 4.036 \approx 4 \ years[/tex]

Then the number of the years is 4.

More about the compound interest link is given below.

https://brainly.com/question/25857212

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A sum of N$2 500 was deposited in a venture account, which pays 12% compounded per year and it accumulated to N$3 950. Calculate the number of years the amount has been in the venture account. Answer must be rounded to the nearest unit?​

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What is compound interest?

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A sum of N$2 500 was deposited in a venture account, which pays 12% compounded per year and it accumulated to N$3 950. Calculate the number of years the amount has been in the venture account. Answer must be rounded to the nearest unit?