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Compound Interest

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You can afford monthly deposits of $250 into an account that pays an yearly interest of 2.4%, compounded monthly. How long will it be until you have $10,200?

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Solution Summary

This solution is comprised of a step-by-step explanation of how to calculate length of time of compound interest before achieving a given amount of money.

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To solve this problem, you need the formula for compound interest:

http://mathforum.org/dr.math/faq/faq.interest.html#deposit
http://www.patrickschneider.com/blog/2008/03/compound-interest-with-an-initial-balance-and-monthly-contributions/

Total = [ ( (1 + i)^n ) * PV ] + [ PMT * ( ( (1 + i)^n - 1) / i ) ...

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