Question

An initial investment of $200 is now valued at $350. The annual interest rate is 8% compounded continuously. The equation

2000007 350 represents the situation, where t is the number of years the money has been invested. About how long has the

money been invested? Use a calculator and round your answer to the nearest whole number

5 years

7 years

19 years

22 years

Answer 1

7 years

Explanation:

We expect your equation is ...

200e^(.08t) = 350

Dividing by 200 and taking the natural log, we have ...

0.08t = ln(1.75)

t = ln(1.75)/.08 ≈ 7.0

The money has been invested 7 years.