Question

How long will it take $500 to double if it earns the following rates? Compounding occurs once a year. Round each answer to two decimal places.

8%.

9%.

20%.

100%.

Answer #1

1)

8%:

Present value = 1

Future value = 2

Future value = Present value ( 1 + r)^{n}

2 = 1 ( 1 + 0.08)^{n}

2 = 1.08^{n}

LN 2 = n LN 1.08

0.693147 = n 0.076961

n = 9.01 years

2)

9%:

Present value = 1

Future value = 2

Future value = Present value ( 1 + r)^{n}

2 = 1 ( 1 + 0.09)^{n}

2 = 1.09^{n}

LN 2 = n LN 1.09

0.693147 = n 0.086178

n = 8.04 years

3)

20%:

Present value = 1

Future value = 2

Future value = Present value ( 1 + r)^{n}

2 = 1 ( 1 + 0.2)^{n}

2 = 1.2^{n}

LN 2 = n LN 1.2

0.693147 = n 0.182322

n = 3.80 years

4)

100%:

Present value = 1

Future value = 2

Future value = Present value ( 1 + r)^{n}

2 = 1 ( 1 + 1)^{n}

2 = 2^{n}

LN 2 = n LN 2

0.693147 = n 0.693147

n = 1 year

How long will it take $800 to double if it earns the following
rates? Compounding occurs once a year. Round each answer to two
decimal places.
8%.
year(s)
12%.
year(s)
19%.
year(s)
100%.
year(s)

How long will it take $400 to double if it earns the following
rates? Compounding occurs once a year. Round each answer to two
decimal places.
A.5%
B.12%
C.19%
D.100%

How long will it take $200 to double if it earns the following
rates? Compounding occurs once a year. Round your answers to two
decimal places.
3%.
year(s)
9%.
year(s)
21%.
year(s)
100%.
year(s)

How long will it take $300 to double if it earns the following
rates? Compounding occurs once a year. Round your answers to two
decimal places.
5%.
?year(s)
10%.
?year(s)
18%.
?year(s)
100%.
?year(s)

TIME FOR A LUMP SUM TO DOUBLE
How long will it take $500 to double if it earns the following
rates? Compounding occurs once a year. Round each answer to two
decimal places.
3%.
year(s)
10%.
year(s)
17%.
year(s)
100%.
year(s)

5-13 TIME FOR A LUMP SUM TO DOUBLE How long
will it take $300 to double if it earns the following rates?
Compounding occurs once a year.
a. 6%
b. 13%
c. 21%
d. 100%

How long will it take an investment of $2000 to double if the
investment earns interest at the rate of 4%/year compounded
monthly? (Round your answer to one decimal place.

How long will it take an investment of $6000 to double if the
investment earns interest at a rate of 7% per year compounded
semi-annually.

Answer the following:
Approximately how many years are needed to double a $500
investment when the interest rates are 10.75 percent per year?
(Round your answer to 2 decimal places)
Period......................years.

How long will it take for $470 to grow to $1,700 at the
following interest rates? (Do not round intermediate calculations.
Round your answers to 2 decimal places.)
4.7%
8.7%
16.7%

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