Final answer:
To determine how long it takes for an investment to double at a compound interest rate of 14% compounded monthly, you can use the formula for compound interest.
Step-by-step explanation:
To determine how long it takes for an investment to double at a compound interest rate of 14% compounded monthly, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A is the future value
P is the principal amount
r is the annual interest rate (as a decimal)
n is the number of times that interest is compounded per year
t is the number of years
In this case, since we want to know the time taken for the investment to double, the future value (A) will be twice the principal amount (P).
Let's take an example where the principal amount (P) is $1 and the future value (A) is $2:
$2 = $1(1 + 0.14/12)^(12t)
By solving this equation for time (t), we can determine how long it takes for the investment to double.