Question

4How much money will Jack have after 7 years if he invests $5,000at 3% interest compounded continuously?

Answer 1

$6168.39

Explanation:

For a principal, P compounded continuously at a rate of r%, the amount in the account after t years is determined using the formula:

`A(t)=Pe^(rt)`

Given:

• The starting amount, P = $5,000

,

• Interest Rate, r = 3% = 0.03

,

• Time(t) = 7 years

Substitute these values into the formula:

`\begin{gathered} A(7)=5000* e^(0.03*7) \\ =\$6168.39 \end{gathered}`

Jack will have $6168.39 in his account after 7 years.