SOLUTION: FIND A, if $7000 is invested at 8% compounded continously for 2 years. if $400 is invested at 3% compunded continously, how many years(to the nearest tenth) would it take

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Question 293726: FIND A, if $7000 is invested at 8% compounded continously for 2 years.



if $400 is invested at 3% compunded continously, how many years(to the nearest tenth) would it take for the investment to double?
Answer by alex224(8) About Me  (Show Source):
You can put this solution on YOUR website!
First you need to know the continuous compounding formula and it is A=Pe^rt
A=ammount
p=principle
e=continuous button on calculator
r=rate
t=time

then plug in what you know
A=7000e^(.08)(2)

then plug into a calculator and make sure to use enough parenthesis
A=(7000e^(.08)(2))
the final answer should be
$15166.02

the next part of the problem is asking for time so you put in what you got for A and use the new information
15166.02=400e^(.03)(t)
first devide both sides by 400
37.91505=e^.03t
37.91505=1.03045t
t=36.8 years