Final answer:
The final amount after 25 years of depositing $8000 in a union that pays 9.125% interest compounded continuously is approximately $41,033.39.
Step-by-step explanation:
Compound Interest Formula:
The compound interest formula is given by:
A = P * e^(rt)
Where:
- A is the final amount after time t
- P is the initial principal (the amount of money deposited)
- e is Euler's number (approximately equal to 2.71828)
- r is the interest rate (decimal form)
- t is the time in years
Calculating the Future Value:
In this case, we have P = $8000, r = 9.125%, and t = 25 years. Plugging in these values into the formula:
A = $8000 * e^(0.09125 * 25)
A ≈ $41,033.39
Therefore, you are projected to have approximately $41,033.39 in 25 years.