Question

Henry is going to invest in an account paying an interest rate of 2.5% compounded continuously. How much would henry need to invest for the value of the account to reach $690 in 6 years?

Answer 1

590

Explanation:

Answer from delta math

Answer 2

$595.34

Explanation:

Step one

given data

interest rate of 2.5%= 0.025

final amount= $690

time = 6 years

Required

Principal P

Step two

The compound interest formula is

`A= P(1+r)^t`

substitute

`690=P(1+0.025)^6\\\\690=P(1.025)^6\\\\690=P1.159\\\\`

divide both sides by 1.159

P=690/1.159

P= $595.34