Answer to Question #277809 in Financial Math for Nic's

Question

If the rate at 1.25 % effective, how long will Php 5,000 become Php 5,500?

Answer 1

Effective rate=$(1+\frac{r}{n})^{n}-1$

5500=5000$(1+\frac{r}{n})^{n}-1$

5000 $×$ 1.25%= 6.25

5500-5000= 500

$500 ÷6.25$ = 80 months/years