Question

Suppose you deposit $600 into an account that pays 5% annual interest, compounded continuously. how much will you have in the account in 4 years? ƒ(t) = ae^(rt).

A) $732.84

B) $729.30

C) $4,433.43

D) $635.62

Answer 1

To find the amount you will have in the account after 4 years with continuous compound interest, use the formula S(t) = P * e^(rt). Plugging in the given values, the answer is $729.30.

Step-by-step explanation:

To find the amount you will have in the account after 4 years, you can use the continuous compound interest formula:

S(t) = P * e^(rt)

Where:

• S(t) is the final amount
• P is the initial principal
• e is the base of the natural logarithm (approximately 2.718)
• r is the interest rate (as a decimal)
• t is the time in years

Plugging in the values from the question, we have:

S(4) = $600 * e^(0.05 * 4)

Calculating this, we find that you will have approximately $729.30 in the account after 4 years. Therefore, the correct answer is B) $729.30.