Answer:
No. of years it will take for the investment to get tripled:
t ≅ 9 years
Step-by-step explanation:
Interest rate = 12.3%
The compound interest formula is given by:
[tex]A = P(1+\frac{r}{n})^{nt}[/tex]
Where
A = Future amount
P = Present amount (Principal amount)
r = Interest rate in decimal form
n = No. of times compounded per year
t = time in years.
We can say that if:
Present amount = P
Future amount = 3P
r = 12.3/100 = 0.123
n = 1
t = ?
Substitute the values in the formula of compound interest:
[tex]3P = P(1+\frac{0.123}{1})^{1t}\\3P=P(1.123)^t \\3=(1.123)^t\\[/tex]
Taking log on both sides.
[tex]log (3)=log(1.123)^t\\log(3)=t\cdot{log(1.123)}\\t=\frac{log(3)}{log(1.123)}\\t=9.47[/tex]
Round off to nearest option
t ≅ 9 years
