Final answer:
To find the interest earned on a $50,000 deposit for six years at 1 1/8% interest, compounded continuously, you can use the formula A = P * e^(rt), where A is the final amount, P is the principal, e is the base of the natural logarithm, r is the interest rate, and t is the time. Plugging in the given values, you can calculate the interest earned to be approximately $5,099.71.
Step-by-step explanation:
To find the interest earned on a $50,000 deposit for six years at 1 1/8% interest compounded continuously, we can use the formula: A = P * e^(rt), where A is the final amount, P is the principal (initial deposit), e is the base of the natural logarithm (approximately 2.71828), r is the interest rate per year in decimal form, and t is the time in years.
Plugging in the given values: A = $50,000 * e^((1 1/8% / 100) * 6).
Using the calculator, we get A ≈ $55,099.71. To find the interest earned, we subtract the initial deposit: Interest = A - P ≈ $55,099.71 - $50,000 ≈ $5,099.71.