Question

You invest $3,000 in an account with an interest rate of 5.5% compounded continuously. How much money would be in the account after 5 years? Round your answer to the nearest whole number.

Answer 1

Use the compound amount formula for continuous compounding:

A = Pe^(rt)

Here,

A = $3000e^(0.055^5) = $3950 (rounded up from $3949.59)