Question

Jasmine invests $1500 in an account that earns an interest rate of 4% compounded

continuously. How much money will she have in 4 years? (round to the hundredth place)

Answer 1

After 4 years she will have $1760.67 in her account.

Explanation:

Jasmine invested initial amount = $1500

Rate of interest = 4% compounded continuously

Duration of investment = 4 years

Formula to calculate the final amount when compounded continuously is,

`P(t)=Ie^(rt)`

where I = Initial amount

r = rate of interest

t = duration of investment

P(t) = Final amount

`P(4)=1500e^(0.04(4))`

=
`1500e^(0.16)`

= 1760.266

≈ $1760.27

Therefore, after 4 years she will have $1760.67 in her account.