8. Matt Wayne has $20,000 to invest and would like to double his money for the purchase of a new truck. Under current market conditions, and given his level of risk tolerance he can only earn 5 percent on his investment. Approximately how long will it take him to get his $40,000?

It will take 14 years and 77 days to double the money.

Explanation:

Giving the following information:

Matt Wayne has $20,000 to invest and would like to double his money for the purchase of a new truck. The interest rate is 5 percent.

We need to find the number of years to achieve $40,000. We will use the following variation of the final value formula:

FV = PV * (1+i) ^n

Isolating n:

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

n = [ln (40,000/20,000) ] / ln (1.05) = 14.21 years

To be more accurate:

0.21*365 = 77

It will take 14 years and 77 days to double the money.