An investment of $28,000 is made in a trust fund at an annual interest rate of 6.75%, compounded continuously. How long will it take for the investment to double? Give your answer to two decimal places.
A) $0.69$ year
B) $14.81$ years
C) $10.27$ years
D) $4.46$ years
E) $4.68$ years

Question

Quizplus · Accepted Answer

To find the time it takes for an investment to double with continuous compounding, use the formula $ t = \frac{\ln(2)}{r} $, where $ r $ is the annual interest rate. Here, $ r = 0.0675 $. Calculating gives $ t = \frac{\ln(2)}{0.0675} \approx 10.27 $ years.

An Investment of $28,000 Is Made in a Trust Fund 0.690.690.69

An Investment of $28,000 Is Made in a Trust Fund $0.69$