Question

Quick Compound Investment

Answer 1

Bob invested $50, 000 at 5% interest, compounded quarterly. How long will it take the investment to double?

\[A(t) = P(1 + \frac{ r }{ n })^{nt}\]

\[100,000 = 50,000 (1 + \frac{ 0.05 }{ 4 })^{4t}\]

\[2 = (1.0125)^{4t}\]

\[\log_{1.0125} 2 = 4t\]

\[t \approx 14\]