Kant Miss Company is promising its investors that it will double their money every 3 years. What annual rate is Kant Miss promising? Is this investment a good deal? If you invest $300 now and Kant Miss is able to deliver on its promise, how long will it take your investment to reach $26 comma 000 ?

Intructions are listed below.

Explanation:

Giving the following information:

Kant Miss Company is promising its investors that it will double their money every 3 years.

A) According to the rule of 70, an investment will duplicate in X number of years using the following formula:

N = 70 / interest rate

In this exercise:

3=70/i

i=70/3 = 23.33%

B) If this is a good deal or not will depend on the interest rate and risk that you are willing to accept.

C) To find how many years it will take to reach to $26000 we need to use the following formula:

n=[ln (FV/PV) ]/ln (1+r)

ln = natural logarithm

FV = Final value

PV = present value

r = interest rate

n=[ln (26000/300) ]/ln (1+0,23333)

n = 21,55 years.