document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=140035>Question 140035</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Hi, i,m confused with this problem i'm not sure whats the difference b/t compounded continously and compounded annually. this is the problem<BR>\n" );
document.write( "Dtermine the time necessary for $7096.1 to double if invested at interest rate 13.2032% a) compounded annually b) compounded monthly c)compounded daily d) compounded continously </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #102068 by </B><A HREF=/tutors/aboutme.mpl?userid=stanbon><B>stanbon(75887)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=stanbon><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=102068\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Dtermine the time necessary for $7096.1 to double if invested at interest rate 13.2032% a) compounded annually b) compounded monthly c)compounded daily d) compounded continously<BR>\n" );
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document.write( "Periodic compounding:<BR>\n" );
document.write( "A(t) = P(1+ (r/n))^(nt)<BR>\n" );
document.write( "a) annually (n=1)<BR>\n" );
document.write( "2*7096 = 7096(1 + (0.132032/1))^(1*t)<BR>\n" );
document.write( "2 = (1.132032)^t<BR>\n" );
document.write( "t*ln(1.132032) = ln2<BR>\n" );
document.write( "t = 5.589... years<BR>\n" );
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document.write( "Monthly compounding: <BR>\n" );
document.write( "n=12 in the same formula<BR>\n" );
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document.write( "Daily compounding <BR>\n" );
document.write( "n=365 in the same formula<BR>\n" );
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document.write( "Continuous compounding:<BR>\n" );
document.write( "A(t) = Pe^(rt)<BR>\n" );
document.write( "2*7096 = 7096 e^(0.132032t)<BR>\n" );
document.write( "2 = e^(0.132032t)<BR>\n" );
document.write( "0.132032t = ln2<BR>\n" );
document.write( "t = 5.2498 years<BR>\n" );
document.write( "======================<BR>\n" );
document.write( "Cheers,<BR>\n" );
document.write( "Stan H. </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );