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38 votes
38 votes
After 4 years you have 5300 what is the initial deposit if the account pays 2.5% annual interest compounded continuously

User Karol Kulbaka
by
2.7k points

1 Answer

18 votes
18 votes

Answer:

Initial deposit P = 4,801 (Approx.)

Explanation:

Given:

Amount after 4 year = 5,300

Number of year = 4 year

Rate = 2.5% = 0.025

Find:

Initial deposit

Computation:

A = P[1+r]ⁿ

5,300 = P[1+0.025]⁴

5,300 = P[1.025]⁴

5,300 = P[1.1038]

Initial deposit P = 4,801 (Approx.)

User Karthik Sankar
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