Find the doubling time of an investment earning 3% interest if interest is compounded continuously?

Answers

Answer 1

Answer:

Time taken (n) = 23.4 years

Explanation:

Given:

Present value (P) = P

SO,

Future value (A) = 2P

Interest rate (r) = 3 % = 0.03

Find:

Time taken (n)

Computation:

[tex]A = p (1+r)^n\\\\ 2P = P(1+0.03)^n \\\\ 2 = (1.03)^n \\\\ n = 23.4 \ years[/tex]

Time taken (n) = 23.4 years

Answer 2
The time taken will be "23.4 years".

Given values:

Interest rate,

r = 3%

          = 0.03

Let,

Present value = PFuture value = 2P

The computation will be:

→ [tex]A = p(1+r)^n[/tex]

By substituting the values,

 [tex]2P = P(1+0.03)^n[/tex]

    [tex]2 = (1.03)^n[/tex]

    [tex]n = 23.4 \ years[/tex]

Thus the above answer is correct.

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