Question

Determine the amount of time it would take for an investment to double if interest is earned at a rate of 3.75% compounded continuously. Use a graph to find your answer.

Answer 1

Given:

The interest rate is 3.75%

The time taken for an investment to double is calculated as,

`\begin{gathered} A=Pe^(rt) \\ A=2P,r=(3.75)/(100) \\ 2P=Pe^(0.0375t) \\ t=(\ln(2))/(0.0375) \\ t=18.484 \end{gathered}`

Answer: The amount of time it wpould take for for an investment to double is approximately 18.484 years.