Answer:
0.50 or about half a year longer.
Step-by-step explanation:
We can write an equation to model bot investments.
Oliver invested $970 in an account paying an interest rate of 7.5% compounded continuously.
Recall that continuous compound is given by the equation:
Where <em>A</em> is the amount afterwards, <em>P</em> is the principal amount, <em>r</em> is the rate, and <em>t</em> is the time in years.
Since the initial investment is $970 at a rate of 7.5%:
Carson invested $970 in an account paying an interest rate of 7.375% compounded annually.
Recall that compound interest is given by the equation:
Where <em>A</em> is the amount afterwards, <em>P</em> is the principal amount, <em>r</em> is the rate, <em>n</em> is the number of times compounded per year, and <em>t</em> is the time in years.
Since the initial investment is $970 at a rate of 7.375% compounded annually:
When Oliver's money doubles, he will have $1,940 afterwards. Hence:
Solve for <em>t: </em>
Take the natural log of both sides:
Simplify:
When Carson's money doubles, he will have $1,940 afterwards. Hence:
Solve for <em>t: </em>
Take the natural log of both sides:
Simplify:
Hence:
Then it will take Carson's money:
About 0.50 or half a year longer to double than Oliver's money.