Question

An initial investment of $100 is now valued at $150. The annual interest rate is 5%, compounded

continuously. The equation 100e0.056 = 150 represents the situation, where t is the number of years the
money has been invested. About how long has the money been invested? Use your calculator and round
to the nearest whole number.
years

Answer 1

8 years on edge

Explanation:

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Answer 2

8 years

Explanation:

100e^(.05t) = 150 . . . . . a better model of the situation

e^(.05t) = 150/100 . . . . divide by 100

0.05t = ln(1.5) . . . . . . . . take natural logs

t = ln(1.5)/0.05 ≈ 8.11 . . . . divide by the coefficient of t

The money has been invested for about 8 years.