Question

Casey invested $1,225 in a certain bond that pays 19% interest compounded annually. How long will it take for Brad’s investment to triple ? Explain .

Answer 1

6.3 years

Explanation:

The growth factor each year is 1+19% = 1.19. You want to find the number of years (t) that result in a multiplier of 3 for the account value:

3 = 1.19^t

Taking logarithms, you get ...

log(3) = t·log(1.19)

log(3)/log(1.19) = t ≈ 6.32

It will take a little more than 6 years for Casey/Brad's investment to triple in value.