SOLUTION: Suppose an initial investment of $5,000 doubles in value every 6 years. Write an equation to model the value of this investment. How much will the investment be worth in 18 y

 

Hi, 

initial investment of $5,000 doubles in value every 6 years: (A/P = 2)

In General 

A = Accumulated Amount

P= principal(Initial Investment) = 

r= annual rate = .

n= periods per year = 1 

t= years = 



        e^(ln2/6)= 1+r

             .1225 = r, 12.25%  Simple Interest/yr

  A = P(1.225)^t

How much will the investment be worth in 18 years

6 yrs = $10,000

12 yrs = $20,000

18 yrs = $40,000