Question

What will the balance be after 10 years if $1500 is invested at 1.5% interest compounded continuously?

Answer 1

Is the interest compounded annually?

Answer 2

A = $1,742.75

A = P + I

Where

P is the principal (1,500.00)

I is the interest (242.75)

Steps:

First, convert R as a percent to r as a decimal

r = R/100

r = 1.5/100

r = 0.015 rate per year,

Then solve the equation for A

`A = Pe^(rt)\\A = 1,500.00(2.71828)^((0.015)(10))\\A = $1,742.75`

Summary:

The total amount with compound interest on a principal of $1,500.00 at a rate of 1.5% per year compounded continuously over 10 years is $1,742.75.