How to set up this problem

Question

If an investment of $1,000 doubles every 7 yrs, find the value of the investment after 28 yrs. A=P(1+r)^t

 

If P dollars are invested at a rate r, compounded annually,  it will grow to A dollars in t years according to the formula.

Answer 1

This may look really scary, but it's really simple math. The investment doubles every 7 years, so every 7 years, the total doubles. Since 28 is divisible by 7, the rate doubles 4 times, which is 2^4. If you know your exponent multiplications, this is 16! So you could do 1000 x 16. (A=1000(2^4)). OR you can do this one by hand.

1,000 x 2 = 2,000. It's been 7 years.

2,000 x 2 = 4,000. It's been 14 years.

4,000 x 2 = 8,000. It's been 21 years.

8,000 x 2 = 16,000. It's been 28 years. Your total is 16,000!