How long does it take for a deposit of $500 to double at 8% compounded continuously?
To find out how long it will take for a deposit to double in an account with 8% interest compounded annually, use the Rule of 72 or compound interest formula. According to the Rule of 72, it will take about 9 years. The exact calculation using the compound interest formula also results in approximately 9 years.
Answer and Explanation:
Since it is compounded semi-annually, the interest rate would be 8% / 2 = 4%. For semi-annual, the number of years would be 17.7 / 2 = 8.8. Hence, it will take 8.8 years to double the investment.
Answer and Explanation:
The answer is 14.21 years. This is a future value (FV) problem that asks for the time necessary to double the PV of an initial investment of $500, given a simple annual interest rate of 5%. Using the variables provided, the problem is stated and solved algebraically, as illustrated below.
Final answer:
To calculate the future value of a continuously compounded investment, use the formula A = P * e^(rt) and plug in the given values. The investment of $500 at 5% interest would be worth approximately $663.60 after 8 years.
Answer and Explanation:
Since interest is compounded quarterly we first estimate the number of quarters then convert to years. The investment will be doubled in 8 years and 274 days.
Answer and Explanation:
Applying the rule of 72, the number of years it takes to double the value of investment is roughly 72 divided by the annual percentage return. In this question, the annual interest rate is 6%, so the number of years it takes is roughly: 72 / 6 = 12.
| Rate of Return | Rule of 72 # of Years to Double Money | Logarithmic Formula # of Years to Double Money |
|---|---|---|
| 8% | 9.0 | 9.0 |
| 9% | 8.0 | 8.0 |
| 10% | 7.2 | 7.3 |
| 11% | 6.5 | 6.6 |
⇒T=1008=12.5 years.
Thus, it will take 14.21 years for the money to double.
The table below shows the present value (PV) of $10,000 in 20 years for interest rates from 2% to 30%. As you will see, the future value of $10,000 over 20 years can range from $14,859.47 to $1,900,496.38.
What is the 8 4 3 rule of compounding?
The rule of 8-4-3 for mutual funds states that if you invest Rs 30,000 monthly into an SIP with a return of 12% per annum, then your portfolio will add Rs 50 lacs in the first 8 years, Rs 50 lacs in the next 4 years to become Rs 1 cr in total value and adds further Rs 50 lacs in the next 3 yrs to reach Rs 1.5 cr.
Try Flipping Things
Another way to double your $2,000 in 24 hours is by flipping items. This method involves buying items at a lower price and selling them for a profit. You can start by looking for items that are in high demand or have a high resale value. One popular option is to start a retail arbitrage business.
Expert-Verified Answer
Final answer: To reach $7,500 with an 8% interest rate, it would take approximately 9.7 years. Using a calculator, we find that time is approximately 9.7 years.
An investment of $1,000 made today will be worth $1,480.24 in five years at interest rate of 8% compounded semi-annually.
Thus, it will take 3.2 year.
Substituting the given values, we have: 9000 = 4000(1 + 0.06/4)^(4t). Solving for t gives us t ≈ 6.81 years. Therefore, it will take approximately 6.76 years to grow from $4,000 to $9,000 at a 7% interest rate compounded monthly, and approximately 6.81 years at a 6% interest rate compounded quarterly.
Final answer:
It will take approximately 15.27 years to increase the $2,200 investment to $10,000 at an annual interest rate of 6.5%.
This means that the investment will take about 12 years to double with a 6% fixed annual interest rate. This calculator flips the 72 rule and shows what interest rate you would need to double your investment in a set number of years.
Most competitive money market accounts offer APYs between 1.6% and 1.8%. A 1.8% APY would mean you earn $9,074.62 in the first year after depositing $500,000.
How the Rule of 72 Works. For example, the Rule of 72 states that $1 invested at an annual fixed interest rate of 10% would take 7.2 years ((72 ÷ 10) = 7.2) to grow to $2. In reality, a 10% investment will take 7.3 years to double (1.107.3 = 2).
How much is 5% interest on $10,000?
Simple Interest Examples
You want to know your total interest payment for the entire loan. To start, you'd multiply your principal by your annual interest rate, or $10,000 × 0.05 = $500. Then, you'd multiply this value by the number of years on the loan, or $500 × 5 = $2,500.
It means exactly the same as A is 200% faster than B. There is nothing twisted or hard to understand.
100% faster means twice as fast.
For example, if an investment scheme promises an 8% annual compounded rate of return, it will take approximately nine years (72 / 8 = 9) to double the invested money.
T = (S.I. ×100)/(P×R) = (x×100)/(x×8) = 12.5 years. (2) on compound interest. A= P.
