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How long does it take for an investment to double in value if it is invested at 12% compounded monthly?  Compounded continuously?

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From the question, we can see that it's compound interest and we will use compound interest formular to compound it.

A = P(1+r/n)^rt

r = 12% = 0.12

n = 12 --> compounded monthly

We want A = 2P (double your money)

2P = P(1 + 0.12/12)^0.12t

2 = (1 + 0.01)^0.12t

2 = (1.01)^0.12t

Using log

log2 = log(1.01)^0.12t

log2 = (0.12t) log1.01

making t subject of formular

t = log2

0.12 log1.01

t = log2

log1.01^0.12

t = 0.301030

log1.00119475

t = 0.301030

0.0005185

t = 583.6 years.

Compounded continuously

A = P.e^rt

recall, we want A = 2P, r = 12% = 0.12

2P = P.e^0.12t

2 = e^0.12t

using natural log

ln(2) = ln(e^0.12t)

ln(2) = (0.12t) . ln(e)

ln(2) = (0.12t) . 1

0.12t = ln(2)

t = ln(2)

0.12

t = 0.693147

0.12

t = 5.8 years

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