You recently inherited $50,000 from a large property sale. You decide to invest half in a low risk IRA account gaining 3% annual growth. With the other half you put it in a high growth 9% account. Your husband agrees that you can build your dream art studio once the high growth account reaches the project budget amount of $40,000. How long will it be before you can start construction?
A) 5 years
B) 5.54 years
C) 5.45 years
D) 4.45 years
E) 4.55 years
C) 5.45 years
Explanation: I/Y = 9
PV = 25,000
FV = -40,000
CPT N = 5.45
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