Compounded Interest

Question

At what rate do you need to invest money into a bank account earning continuosly compounded interest if you want to double your money in 75 months? 

Answer 1

the equation for continuous compounding is

 

Future Value = Present value * e^rt where r is the interest rate and t is the time in years

 

2 = 1 * e^i*75/12

2 =  e^i*6.25

take natural log of both sides

 

ln(2) = i*6.25

ln(2)/6.25 = i = .1109

 

You must invest at 11.09% to double your money in 75 months

Answer 2

75 months is 6.25 years; the applicable formula is A(t) = Pe^rt where r is the decimal value of the interest rate.

If you would reveal what r is, then all you have to do is to solve 2 = 1e^rt for t, using logarithms.

But without the revelation of what r is, you cannot finish this request.