Find out how long it takes a ​$2,500 investment to double if it is invested at 8% compounded quarterly.

Question

Find out how long it takes a ​$2,500 investment to double if it is invested at 8% compounded quarterly.

Answer 1

8% = 0.08 quarterly is 32% annually....

For the principal to double, need to solve the equation

1.08 ^ N = 2

log 1.08^N = log 2

N log 1.08 = log 2

N = log 2 / log 1.08

= 9

9 quarters is 27 months, or 2 years and 3 months