Question

Bob has $2,500 invested in a bank that pays 4% annually. How long will it take for his funds to double

Answer 1

17.67 years.

It will take 17.67 years for his funds to double.

Present amount is $2,500

Future value of the money to be double of the present value.

This means the future value will be $5,000($2,500 x 2)

Interest rate is 4%

Number of years or periods to reach this $5,000 is unknown.

So we have to find this.

To compute this number of periods, We need to use Financial calculator.

Interest per year = I/Y = 4

Principle value = PV= -2,500

Final value = FV= 5,000

CPT N= 17.67 years.

What exactly does investing mean?

• An investment is defined as an asset that is purchased or invested in in order to increase wealth and set aside money from a hard-earned salary or increase in value.
• The main goal of an investment is to generate additional revenue or to make money on the investment over a certain amount of time.

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