Question

Annie is opening a savings account which earns 5.2% interest compounded continuously how much will she need to deposit in the account so she has $2300 after seven years

Answer 1

1686.22

Explanation:

1686.22

2300=P(1+(0.052x7))

2300=P1.364

P=2300/1.364

=1686.217...

=1686.22..

=1686 for the nearest dollar

Answer 2

Hi

let's call X the initial deposit.

the interest rate is 5.2 %

so each year X increase by 1.052.

so we have : X *1.052^7 =2300

X = 2300/1.052^7

X = 1612,94

please note that the deposit was rounded to the next cent. as the result would be 1612,937...