If $50 is invested at 6 percent interest. How long will it take to double?

1 Answer
Nov 11, 2016

Answer:

16 years and 8 months with simple interest earned
11 years and 11 months with compound interest earned

Explanation:

The time will differ between an investment with compound interest and with simple interest. It will happen sooner with Compound interest.

Simple interest:

In order to double in value, the interest must be #$50#

#SI =(PRT)/100" "rarr (50 xx 6 xx T)/100 =50#

#T = (100xx50)/(50xx6)#

#T= 100/6 = 16.6666 = 16 2/3# years

16 years and 8 months to double with simple interest

Compound interest

In order to double, the Amount must be #$100#

#A = P(1+R/100)^n#

#50(1+0.06)^n= 100#

#(1.06)^n= 100/50 = 2#

#nlog(1.06) = log2#

#n= log2/log1.06#

#n = 11.89# years

#n~~ 11# years and 11 months