Question

Lillian is going to invest in an account paying an interest rate of 5.7% compounded continuously. How much would Lillian need to invest, to the nearest ten dollars, for the value of the account to reach $7,600 in 7 years?

Answer 1

Answer: $5156

Explanation:

Given

The rate of interest is 5.7%

time t=7 years

Amount after 7 years,
`A=\$7600`

for compound interest, the Amount is given by

`\Rightarrow A=P(1+(r)/(100))^T`

Put values

`\Rightarrow 7600=P(1+0.057)^7\\\\\Rightarrow P=(7600)/((1.057)^7)=5,155.71\\\\\Rightarrow P\approx \$5156`