Problema Solution
Determine the per annumal interest rate required for an investment with continuous compound interest to double in 7.75 years. express your answer as a percent. Give an exact answer or round to three decimal places for example 10.227%
Answer provided by our tutors
P = the principal
r = ? annual interest rate
t = 7.75 years
A = 2P the future value
A = P*e^(r*t)
2P = P*e^(r*7.75)
e^(r*7.75) = 2
r*7.75 = ln 2
r = (ln 2)/7.75
r = 0.0894 or 8.94%
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