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

Question

1337 views around the world

You can reuse this answer
Creative Commons License

Answer 1 · 2016-11-11T11:13:02

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

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