Question

How many years will it take for an initial investment of $20,000 to grow to $30,000? Assume a rate of interest of 6% compounded continuously.

Answer 1

F = Pe^(rt)

F is the final amount

P is the principal

r is the interest rate

t is the time in years

30000=20000 e^(.06t)

divide by 20000

3/2 = e ^ .06t

take the ln on each side

ln(3/2) = .06t

divide by .06

ln(3/2)/.06 =t

t=6.75775 years