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Larry deposits $350 in an account that pays 2.8% interest compounded continuously. How long will it take for him to have $500 in the account?

1 Answer

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Final answer:

To find how long it will take for Larry to have $500 in the account, we can use the continuous compound interest formula. Plugging in the given values, we find that it will take Larry approximately 11.16 years to have $500 in the account.

Step-by-step explanation:

To find how long it will take for Larry to have $500 in the account, we can use the continuous compound interest formula:

A = P * e^(rt)

Where A is the amount of money in the account, P is the initial deposit, e is Euler's number (approximately 2.71828), r is the interest rate, and t is the time in years.

Plugging in the given values, we have:

$500 = $350 * e^(0.028t)

Dividing both sides by $350, we get:

e^(0.028t) = 500/350

Simplifying further:

e^(0.028t) = 1.4286

Taking the natural logarithm of both sides:

0.028t = ln(1.4286)

Dividing both sides by 0.028, we get:

t = ln(1.4286)/0.028

Using a calculator, we can find that t is approximately 11.16 years. Therefore, it will take Larry approximately 11.16 years to have $500 in the account.

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