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kolezko [41]
3 years ago
8

(1+(0.065÷365))^365t=4

Mathematics
1 answer:
marta [7]3 years ago
7 0
This is the future value quadrupled in t years at an annual interest rate of 6.5% compounded daily.  We need to find t.

1*(1+0.065/365)^(365t)t=4
take log on both sides,
365t(log(1+0.065/365)=log(4)
=>
365t=log(4)/log(1+0.065/365)
t=(log(4)/log(1+0.065/365))/365
=(1.38629/.000178066)/365
=21.33 years

Check with the rule of 69, applicable to continuous compounding (an approximation to current problem) to double money, it take 69/interest rate in % years.
=69/6.5
=10.62 years
To double twice (quadruple), it takes twice 10.62
=21.24 years, not that far from 21.33 that we got earlier.
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