If 8000 is placed in an account with an annual interest rate

If $8,000 is placed in an account with an annual interest rate of 6%, how long will it take the amount to quadruple if the interest is compounded annually? Select one: 23.79 years 23.11 years 16.67 years 19.89 years

Solution

investment = $ 8000

interest rate = 6%

amount = 4(8000) = 32,000

plugging the values in the formula

A = P ( 1 + r/n)^nt

32000 = 8000 ( 1 + .06 )^t

4 = 1.06 ^ t

taking natural log on both sides

ln 4 = t ln ( 1.06 )

t = ln 4 / ln 1.06

t = 23.79 years

option a is correct