Question

A person places $4080 in an investment account earning an annual rate of 5. 7%,

compounded continuously. Using the formula V = Pent, where Vis 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 4 years.

Answer 1

$5,124.83

Explanation:

We have the formula: V = Pe^rt

Plug in the given information

P = Principal amount (4080)

r = rate (0.057)

t = years (4)

V = 4080e^(0.057)(4)

V = 4080e^0.228

V = 4080(1.2560853)

V = 5124.828024