Question 465400: my last problem stated this "if interest is compounded annually, how much is 1000 worth in 8 years at 8%"
and my answer was %1850.93...so i think you need that info to answer problems 1 and 2! thanks so much!
the formula to find the total amount in your savings account(if interest is compounded continuously) after t years is A=Pe^rt (A=total amount, P=original amount, and r=interest rate.)
1. how long does it take your money to double at 8% interest? (round to the nearest year.)
2. what about at 5%? (round to the nearest year.)
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! my last problem stated this "if interest is compounded annually, how much is 1000 worth in 8 years at 8%"
A(8) = 1000(1.08)^8 = $1850.93
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the formula to find the total amount in your savings account(if interest is compounded continuously) after t years is A=Pe^rt (A=total amount, P=original amount, and r=interest rate.)
1. how long does it take your money to double at 8% interest? (round to the nearest year.)
---
2*1000 = 1000*e^(0.08t)
---
e^(0.08t) = 2
Take the natural log to get:
0.08t = ln2
t = (ln(2)/0.08 = 8.66 years
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2. what about at 5%? (round to the nearest year.)
0.05t = ln2
t = (ln(2))/0.05
t = 13.86 years
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Cheers,
Stan H.
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