Question

Suppose $500 is invested at 6% annual interest compounded twice a year. When will the investment be worth $1000.

Answer 1

Explanation:

`V=P(1+r/c)^((ct))\\ \\ V=P(1+.06/2)^((2t))\\ \\ 1000=500(1.03)^((2t))\\ \\ (1.03)^(2t)=2\\ \\ 2t=ln2/(ln1.03)\\ \\ t=ln2/(2ln(1.03))\\ \\ t\approx 11.7 years`