SOLUTION: Nick deposits $8,000 into a savings account which pays 7% per year. If the account compounds continuously, find the time it takes to double his investment. (Round your answer to th

Question 981311: Nick deposits $8,000 into a savings account which pays 7% per year. If the account compounds continuously, find the time it takes to double his investment. (Round your answer to the nearest whole year.)
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
P=8000e^rt
16000=8000e^rt
2=e^(.07)t
ln of both sides
0.693=0.07*t
9.9 years. This is consistent with the rule of 72 (easier to work with), which is better as the rule of 70.
Divide the interest rate (%) into 70, and one gets the doubling time in years.

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