Question

Find the amount of money that will be accumulated in a savings account If SSS50 is invested at 9.0 % for 18 years and the interest is compounded continuously.Round your answer to two decimal places.

Answer 1

It is given that,

`\begin{gathered} Rate\text{ = 9\% = }(9)/(100)=0.09 \\ time\text{ = 18 years} \\ Principal\text{ = \$ 5550} \end{gathered}`

Continuous compound interest is given as,

`\begin{gathered} Continuous\text{ c}ompound\text{ interest = P}* e^(rt) \\ Continuous\text{ c}ompound\text{ interest = 5550 }*\text{ e}^(0.09*18) \\ Continuous\text{ c}ompound\text{ interest = }\frac{}{}5550\text{ }*\text{ e}^(1.62) \\ Continuous\text{ c}ompound\text{ interest = 28044.65 } \\ \\ \end{gathered}`

Thus the continuous compound interest is $28044.65.