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how much would $500 invested at 4% interest compounded continuously be worth after 10 years? round your answer to the nearest cent. I got $740.12.

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Answer:

Step-by-step explanation:

To calculate the future value of an investment, we can use the formula for continuous compound interest:

A = P * e^(rt)

Where:

A = the future value of the investment

P = the principal amount (initial investment)

e = the mathematical constant approximately equal to 2.71828

r = the interest rate (as a decimal)

t = the time period in years

In this case, the principal amount (P) is $500, the interest rate (r) is 4% or 0.04 (as a decimal), and the time period (t) is 10 years.

Plugging these values into the formula, we get:

A = 500 * e^(0.04 * 10)

Now, let's calculate the value using a calculator:

A ≈ 500 * e^(0.4)

A ≈ 500 * 1.4918247

A ≈ 745.91

Therefore, $500 invested at a 4% interest rate compounded continuously would be worth approximately $745.91 after 10 years, rounded to the nearest cent.

User Paul Dejean
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