Concept explainers
Under continuous compounding, the amount of time t in years required for an investment to double is a function of the annual interest rate r according to the formula:
Use the formula for Exercises 61–63. (See Example 8.)
a. If you invest $3000, how long will it take the investment to reach $6000 if the interest rate is 5.5%? Round to one decimal place.
b. If you invest $3000, how long will it take the investment to reach $6000 if the interest rate is 8%? Round to one decimal place.
c. Using the doubling time found in part (b), how long would it take a $3000 investment to reach $12,000 if the interest rate is 8%?
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