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How long does it take $500 to double at a simple interest rate of 24%?

User Lemm Ras
by
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1 Answer

11 votes

Answer:

4 years and 2 months

Explanation:

Simple interest formula

A = P(1 + rt)

where:

  • A = final amount
  • P = principal amount
  • r = interest rate (in decimal form)
  • t = time (in years)

Given:

  • A = $500 × 2 = $1,000
  • P = $500
  • r = 24% = 0.24

Substitute the given values into the formula and solve for t:


\implies \sf 1000 = 500(1 + 0.24t)


\implies \sf (1000)/(500)=(1 + 0.24t)


\implies \sf 2=1 + 0.24t


\implies \sf 1 = 0.24t


\implies \sf t=(1)/(0.24)


\implies \sf t=4 (1)/(6) \:years


\implies \sf t=4\:years\:2\:months

Therefore, it takes 4 years and 2 months for the initial investment of $500 to double at a simple interested rate of 24%.

User EhTd
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