Question

A person places $1380 in an investment account earning an annual rate of 8.6%, compounded continuously. Using the formula V = Pe^{rt}V=Pe rt , where V is the value of the account in t years, P is the principal initially invested, e is the base of a natural logarithm, and r is the rate of interest, determine the amount of money, to the nearest cent, in the account after 10 years.

Answer 1

V = 3261.16

Explanation:

Given:

P = 1380

r = 8.6% or 0.086

t = 10

Work:

`V=Pe^(rt)\\\\V=1380e^(0.086*10)\\\\V=1380e^(0.86)\\\\V=3261.16`