Question

Find out how long it takes a $3,500 investment to double if it is invested at 7%

Answer 1

Answer:

9.99 years

Step-by-step explanation:

P=$3,500

r=7%=0.07

n=4(quarterly)

A= double of $3,500=

$3,500×2=$7,000

t=?

A=p(1+r/n)^nt

$7,000=$3,500(1+0.07/4)^4t

$7,000=$3,500(1+0.0175)^4t

$7,000=$3,500(1.0175)^4t

Divide both sides by $3,500

2=(1.0175)^4t

Take the log to base 10 of both sides

log2=4t × log1.0175

0.30103=4t × 0.00753

0.30103=4(0.00753)t

0.30103=0.03012t

t=0.30103/0.03012

t=9.99435

Approximately

9.99 years