How long does it take $1700 to double if it is invested at 5% interest, compounded monthly?
14.2 years
You need to solve (1.05)^x X (1700)= 3400
so (1.05)^x = 3400/1700 = 2
(1.05)^x =2
take logs of both sides
x ln(1.05) = ln(2)
x= ln(2)/ ln(1.05) = 14.2
FV = PV x [1 + R]^N
3,400 =1,700 x [1 + 0.05/12]^N divide both sides by 1,700.
2 = [1.004166667]^N take the log of both sides.
N =Log(2) / Log(1.004166667)
N =166.7 months - for $1,700 to double. Or:
N =166.7/12 =13.89 years.
