Write the word or phrase that best completes each statement or answers the question.
-Assume the cost of a car is $\$ 23,000$. With continuous compounding in effect, find the number of years it would take to double the cost of the car at an annual inflation rate of $6.5 \%$. Round the answer to the nearest hundredth.
A) $154.51 \mathrm { yr }$
B) $10.66 \mathrm { yr }$
C) $1.55 \mathrm { yr }$
D) $165.18 \mathrm { yr }$

Question

Quizplus · Accepted Answer

To find the number of years it takes for an investment to double with continuous compounding, you can use the formula $t = \frac{\ln(2)}{r}$, where $t$ is the time in years and $r$ is the annual interest rate (expressed as a decimal). For an annual inflation rate of $6.5\%$, $r = 0.065$. Plugging these values into the formula gives $t = \frac{\ln(2)}{0.065}$, which approximately equals $10.66$ years.

Write the Word or Phrase That Best Completes Each Statement $23,000\$ 23,000$23,000

Write the Word or Phrase That Best Completes Each Statement $\$ 23,000$