Question

Find the interest earned from an investment of $14000 for 4 years at an interest rate of 6.85% compounded continuously. Round to the nearest cent.

Answer 1

$4242

Explanation:

Given data

Principal= $14000

TIme = 4 years

Rate= 6.85%

Let us find the final amount A

A=P(1+r)^t

substitute

A=14000(1+0.0685)^4

A=14000(1.0685)^4

A=14000*1.303

A=$18242

Hence the interest is

Interest= Final amount-Principal

=18242-14000

=$4242