   Chapter 6.2, Problem 50E

Chapter
Section
Textbook Problem

Compound Interest In Exercises 49 and 50, find the time necessary for $1000 to double when it is invested at rate r and compounded (a) annually, (b) monthly, (c) daily, and (d) continuously. r = 5.5 % (a) To determine To calculate: The time required to double$1000 when it is invested at rate r and compounded annually.

Explanation

Given:

Rate of interest is r=5.5%.

Formula used:

We can use the formula for amount:

A=P(1+r100)t

Calculation:

Let us consider the expression:

A=P(1+r100)t.…… (1)

If the amount be doubled, A=2P.

By putting r=5.5, A=2P in equation (1), we get:

A=P(1+r100)t2P=P(1+5.5100)t2=(105

(b)

To determine

To calculate: The time required to double $1000 when it is invested at rate r and compounded monthly. (c) To determine To calculate: The time required to double$1000 when it is invested at rate r and compounded daily.

(d)

To determine

To calculate: The time required to double \$1000 when it is invested at rate r and compounded continuously.

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