SOLUTION: A one-time deposit is made into an account that pays an APR of 8.5% compounded continuously. How long does it take for the worth of the account to triple? Could you please

Algebra ->  Exponential-and-logarithmic-functions -> SOLUTION: A one-time deposit is made into an account that pays an APR of 8.5% compounded continuously. How long does it take for the worth of the account to triple? Could you please       Log On


   

Question 194466: A one-time deposit is made into an account that pays an APR of 8.5% compounded continuously. How long does it take for the worth of the account to triple?

Could you please provide a detailed explanation of how you achieved the solution. Thanks!
Answer by vleith(2983) About Me  (Show Source):
You can put this solution on YOUR website!
The formula for continuously compound interest is
F%5Bv%5D+=+++Pe%5E%28tr%29
See this URL--> http://www.moneychimp.com/articles/finworks/continuous_compounding.htm
How long to triple?
That is the same as asking how much time it takes for a value P to become 3P
F%5Bv%5D+=+++Pe%5E%28tr%29
3P+=+++Pe%5E%28t%2A0.085%29
3+=+e%5E%28t%2A0.085%29
ln%283%29+=+%28t%2A0.085%29
1.098%2F0.085+=+t
12.92485+=+t
It takes just under 13 years