How long will it take a 500 investment to be worth 800 if it is continuously compounded at 8 percent per year?

Answer 1

500*1.08y=800 (y being the number of years.)

1.08y=1.6

y*log(1.08)=log1.6 (base of log doesn't matter)

y=log(1.6)/log(1.08)

y=6.1 years

In this case you can't have 0.1 of a year so you round up.

so if you leave it in the bank for 7 years you will have over 800. (to be exact you will have 856.91)

if you had only left it for 6 you would have 793.44