It will take 7 years to double the invested amount if the invested amount is compounded at 10% continuously.
What is compound interest?
- Compound interest, also known as interest on principal and interest, is the practice of adding interest to the principal amount of a loan or deposit.
- The interest you earn on interest is known as compound interest.
- Simple math may be used to demonstrate this: if we have $100 and it generates 5% interest annually, we will have $105 at the end of the first year.
- We will wind up with $110.25 at the conclusion of the second year.
- Our investment will double at a 10% interest rate in roughly 7 years (72 x 10% = 7.2); at a 12% interest rate, it will double in roughly 6 years (72 x 12%).
Therefore, it will take 7 years to double the invested amount if the invested amount is compounded at 10% continuously.
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