How long will it take an investment that pays 3% compounded annually to double in value? Round to the nearest tenth of a year.

Question

anonymous · Answer

Write out the compound interest formula.  Your starting amount can be A, and your final amount would be 2A (since you have twice as much).  Then, solve for time.

moonlitfate · Answer

Compound interest is: A = P(1+r/n)^nt  
I think anyway.

kropot72 · Answer

$$2A=A(1+0.03)^{t}$$
Dividing both sides by A and simplifying gives:
$$(1.03)^{t}=2$$
Now solve for t by taking logs of both sides.

moonlitfate · Answer

Ironically, I just figured out.  :) I plugged in 100 for A; so 2A was 200 and A on the right was 100 and solved for t.

kropot72 · Answer

Glad to hear it :)

moonlitfate · Answer

I guess the variables were just throwing me off a bit.  They tend to do that.