Problema Solution

How long will it take an investment of $750 to triple at an interest rate of 3.2% and compounded quarterly? Round to the nearest hundredth.

Answer provided by our tutors

let 'A' represent accumulated total, 'p' represent principal, 'r' represent rate, 'n' represent number of times per year compounding is performed and 't' represent number of years of compounding

A = p(1+r/n)^(nt)


principal starts at $750, therefore we want A=750*3=2250

compounding quarterly, therefore n=4


we want to solve for 't':

2250 = 750(1+0.032/4)^(4t)

solving for 't' we have t=34.468


it will take approximately 34 and 1/2 years for the investment to triple