Question

2/8

QUESTION 8.1 POINT
If $20,000 is invested at 8.3% compounded continuously, how long, to the nearest tenth of a year will it take before the
investment doubles?

Answer 1

9514 1404 393

Answer:

8.4 years

Explanation:

The value of P compounded continuously at rate r for t years is ...

A = Pe^(rt)

Solving for t, we find ...

t = ln(A/P)/r = ln(2)/0.083 ≈ 8.35117

It will take about 8.4 years for the investment to double.