Question

You deposit $10,000 in an account that pays 6% annual interest compounded continuously. What is the interest you can get from the account after ten years? Round your answer to the nearest cent.

Answer 1

The interest you can get from the account after ten years is $8,201.89.

Step-by-step explanation:

To calculate the interest you can get from an account with continuous compounding, we can use the formula A = P * e^(rt), where A is the final amount, P is the principal amount, r is the interest rate, and t is the time in years. In this case, P = $10,000, r = 0.06, and t = 10. Substituting these values into the formula, we get A = $10,000 * e^(0.06 * 10). Using a calculator, we find that A is approximately $18,201.89. The interest you can get from the account after ten years is the difference between the final amount and the principal amount, which is $18,201.89 - $10,000 = $8,201.89.