Question

2. Use the formula below to find the value of $650 invested at 5% interest compounded continuously for6 years.Interest FormulaA(t) = P. enP= Amount invested, in dollarsr= Interest rate, as a decimalt = Time invested, in yearse 2.718Step 1: Find the value of each of the following for this problem: (1.5 points)P=r=t=Step 2: Find the value of A(6). Round your answer to the nearest hundredth. Show your work.

Answer 1

We are given the following formula:

`A=Pe^(rt)`

Where A is the amount in the account after t years, P is the principal (the initial amount invested), r is the interest rate and t is the time in years.

In this case, P equals 650 ($650), since this is the initial amount invested, r is the rate of interest, which is 0.05 (5%) and t is 6 (6 years). Then:

P = 650

r = 0.05

t = 6

By replacing these values into the above equation, we get:

`A=650e^(0.05*6)=877.38`

Then:

A(6) = 877.38