Question 999383: How long will it take an investment of $7,000 to double if the investment earns interest at the rate of 7% compounded continuously? (Round your answer to two decimal places.)
Answer by lwsshak3(11628)   (Show Source):
You can put this solution on YOUR website! How long will it take an investment of $7,000 to double if the investment earns interest at the rate of 7% compounded continuously? (Round your answer to two decimal places.)
compound interest formula for continuous compounding:A= Pe^rt, P=initial investment,r=interest rate,A = amount after t-years
A/P=2
A/P=e^rt=2
take log of both sides
rtlne=ln2
rt=ln2
t=ln2/.07=9.9.90 yrs
How long will it take an investment of $7,000 to double? 9.90 yrs
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