Question

Trust Fund A deposit of $10,000 is made in a trust fund that pays 7% interest,compounded continuously.it is specified that the balance will be given to the college from which the donor graduated after the money has earned interest for 50 years.How much will the college receive?

Answer 1

After 50 years college will receive a amount of $294570.25

Explanation:

We have given deposited amount P = $10000

Rate of interest r = 7 %

Time is given t = 50 years

We have to find the amount after 50 years which college receive

Amount is given by

`A=P(1+(r)/(100))^n`

`A=10000(1+(7)/(100))^(50)=294570.25`

So after 50 years college will receive a amount of $294570.25