You can put this solution on YOUR website! how long, to the nearest year, will it take an investment to triple if it is continuously compunded at 5% per year? . Continuous compounded interest formula: A = Pe^(rt) Where A is accumulated sum after t time P is initial principal r is rate or interest t is time . 3P = Pe^(.05t) Dividing both sides by P: 3 = e^(.05t) Take the ln of both sides: ln(3) = .05t ln(3)/.05 = t 22 years = t
How long will it take for an investment to triple if it is compounded continuously at 14%? Let P = the principal (the investment) t = the time in years r = 0.14 or 14% the annual interest rate A = 3P the future value (the investment will triple) the future value formula is: A=Pe^(rt) we plug the above values and get: 3P = Pe^(0.14t) Pe^(0.14t) = 3P ........ ........ t = 7.85 years It will take 7.85 years for the investment to triple.
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Ohio State University
In order to continue enjoying our site, we ask that you confirm your identity as a human. Thank you very much for your cooperation. 1 Expert Answer The compound interest formula is: Where A is the current value, P is the initial investment, r is the rate, and t is time. If an investment triples, that means A is currently equal to 3*P Your interest rate is 5%, or, 0.05 |
How long will it take for an investment to triple if interest is compounded continuously at %?
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