SOLUTION: Need a little help here. Thanks!
If $5000 is invested at 4% how long will it take John to triple his investment if the compounding is continuous at the same rate?
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If $5000 is invested at 4% how long will it take John to triple his investment if the compounding is continuous at the same rate?
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Question 312448: Need a little help here. Thanks!
If $5000 is invested at 4% how long will it take John to triple his investment if the compounding is continuous at the same rate? Answer by solver91311(24713) (Show Source):
The formula to calculate future value, , of an investment, , at annual rate for years, where is the base of the natural logarithms and is expressed as a decimal fraction is:
Actually, you don't care what the initial investment is for this problem. All you care about is that the ratio , which is to say:
Take the natural log of both sides:
Use
Use
but for your case , hence
A (very) little calculator work and you have your approximate answer.
Compare your result here to the decision whether to take a Lotto Jackpot payment in 26 equal installments or to take half of the money in one lump sum.
