Question

Approximately how many years will it take $3000 to double if it is invested in an account that pays 3%

compounded monthly? Round your answer to the nearest whole year.

Answer 1

24 years

Explanation:

Total = start*(1 + interest rate / amount of times compounded per month)^(years*amount of compounds per year)

6000 = 3000*(1+0.03/4)^(4x)

6000 = 3000* ((403/400)^4)^x

2 = ((403/400)^4)^x

x = log base-((403/400)^4) of 2 = x

x = 23.19

rounding down 23 years (but you probably want a year over that to get at least 6000, so 24)