Question

Alan deposited $300 in an account that pays 6% interest compounded continuously. Approximately how long will it take for Alan's money to triple?

Answer 1

how much is this 6% of $300 ?

can you calcule it ?

how much will be the Alan's money tripled ?

Answer 2

continuous compounding formula:

A = Pe^(rt)

where P is the principal, e is a constant (approx: 2.71828), r is the interest rate as a decimal (0.06) and t is time (which you'll solve for)

since it wants to know how long it'll take for the $ to triple, A = 3P

substituting that into the equation, we get:

3P = Pe^(0.06t)

notice how P cancels out on both sides:

3 = e^(0.06t)

solve for t.