Answer:
22.2 years
Step-by-step explanation:
You want to find the doubling time for a simple-interest savings account with an interest rate of 4.5%.
The formula for the amount in a simple-interest account is ...
A = P(1 +rt)
where P is the amount invested at annual rate r for t years.
Filling in the given values, we want to find t:
2×6200 = 6200(1 +0.045t)
Dividing by 6200, we have ...
2 = 1 +0.045t
1 = 0.045t . . . . . . . . subtract 1
1/0.045 = t ≈ 22.2 . . . . . divide by the coefficient of t
It will take about 22.2 years for the investment to double in value.
The amount of $6,200 would double on simple interest of 4.5% after 22.22 years
What is simple interest?
Simple interest is an alternative of computing interest on an investment where is only computed on the original investment.
For a simple interest, the future value is the initial principal plus interest
A=P+I
P=principal
I=interest=PRT
P=principal
R=rate of rate interest=4.5%
T=number of times it takes to double the investment=unknown
A=P+(PRT)
A=$6200*2=$12,400
$12,400=$6200+($6200*4.5%*T)
$12,400-$6,200=$6200*4.5%*T
$6,200=$279*T
T=$6200/$279
T=22.22 years
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