Question

You decide to put $100 in a savings account to save for a $3,000 down payment on a new car. If the account has an interest rate of 2% per year and is compounded monthly, how long does it take you to earn $3,000 without depositing any additional funds?

Answer 1

In order to solve this problem you would need to use the formula
FV = PV*(1+r/n)^(n*t)
If you do that then you may see the variables like this
FV = 3000
PV = 100
r = 0.02
n = 12
After using all of them you get the total of 171.755 years. Hope this is very useful