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Here is the problem:

 

"A Registered Retirement Savings Plan (RRSP) mutual fund is based on stocks, bonds, and other money market funds that are continuously compounding. A principle of $10 000 was invested in a mutual fund with an annual interest rate of 4.75% under continuous compounding. How long will it take for the investment to double?"

 

The answer is 14.6 years, how should I get this answer?

 Feb 18, 2020
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The easiest and simplest way to do it is as follows:

 

1 - e^0.0475 =1.0486462011212.......

 

2 - 2 = 1 * 1.0486462011212^N, solve for N

 

3 - N =Log(2) / log(1.0486462011212)

 

4 - N =14.5926 = 14.6

 Feb 18, 2020

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