Time for a Lump Sum to Double How long will it take dollar 200 to double if it i

Question

Time for a Lump Sum to Double How long will it take dollar 200 to double if it is deposited and earns the following rates? Round your answers to the closest year. [Notes: (1) This problem cannot be solved exactly with some financial calculators. For example, if you enter PV = -200, PMT = 0, FV = 400, and I = 7 in an HP-12C and then press the N key, you will get 11 years. The correct answer is 10.2448 years, which rounds to 10, but the calculator rounds up. However, the HP10BII gives the exact answer; (2) If you are using a financial calculator, you can enter the known values and then press the appropriate key to find the unknown variable. Then, without clearing the TVM register, you can "override" the variable that changes by simply entering a new value for it and then pressing the key for the unknown variable to obtain the second answer.] 8 percentage. year(s) 10.9 percentage. year(s) 20.2 percentage. year(s) 100 percentage. year(s)

Explanation / Answer

Using the formula to find the amount under compound interest Future value=Present Value(1+Interest Rate)^ No.of Years. a) 8% 400=200*(1.08)^n Solving in an online equation solver, No.of Years   n= 9.00647 Years b)10.9% 400=200*(1.109)^n Solving in an online equation solver, No.of Years   n= 6.6998 Years c)20.2% 400=200*(1.202)^n Solving in an online equation solver, No.of Years   n= 3.7674 Years d)100% 400=200*(2)^n Solving in an online equation solver, No.of Years   n= 1 Year

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