A sum of money placed at compound interest doubles itself in 4 years. In how many years will it amount to 8 times itself?
Created: 2 years ago |
Updated: 8 months ago
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When a sum of money doubles itself at compound interest in a certain period, it means it has grown by a factor of 2. To find out in how many years it will amount to 8 times itself, we need to determine the number of times it needs to double.
Let "n" be the number of times the amount doubles.
2^n = 8
To solve for "n," we can rewrite 8 as a power of 2:
8 = 2^3
Now, our equation becomes:
2^n = 2^3
Since the bases are the same (both 2), we can equate the exponents:
n = 3
So, the sum of money will amount to 8 times itself in 3 periods of doubling, which is 3 * 4 years:
3 * 4 = 12 years
Therefore, it will take 12 years for the sum of money to amount to 8 times itself at compound interest.
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