Question

Do not round any computations, and round your answer to the nearest cent

Answer 1

Given:

`\begin{gathered} r=2.5\%=0.025 \\ P=1700 \\ t=4years \end{gathered}`

To Determine: The amount after 4 years

Solution

To calculate the amount for a deposit compounded continuously, we would use the formula below

`A=Pe^(rt)`

Substitute the given into the formula

`\begin{gathered} A=1700e^(0.025*4) \\ A=1700e^(0.1) \end{gathered}`
`\begin{gathered} A=1700*1.1051709 \\ A=1878.79 \end{gathered}`

Hence, the money saver in the next four years would have $1,878.79 in his account