If you deposit money today in an account that pays 45 annual

If you deposit money today in an account that pays 4.5% annual interest, how long will it take to double your money? Round your answer to two decimal places.

Solution

We use the formula:
A=P(1+r/100)^n
where
A=future value($2x)
P=present value($x say)
r=rate of interest
n=time period.

2x=x(1+4.5/100)^n

2=(1.045)^n

Taking log on both sides;

log 2=n*log(1.045)

n=log 2/log(1.045)

=15.75 years(Approx).