13.4k views
4 votes
If you invest $600 at 5% interest compounded continuously, how much would you make after 6 years?

User Enilce
by
4.4k points

2 Answers

7 votes

Answer:

$809.92

Explanation:

(see attached for reference)

Recall that the formula for compound interest (compounded continuously) is

A = P e^(rt)

where,

A = final amount (we are asked to find this)

P = principal = given as $600

r = interest rate = 5% = 0.05

t = time = 6 years

e = 2.71828 (mathematical constant)

Substituting the known values into the equation:

A = P e^(rt)

= 600 e^(0.05 x 6)

= 600 (2.71828)^(0.30)

= $809.92

If you invest $600 at 5% interest compounded continuously, how much would you make-example-1
User Kien Bui
by
4.4k points
4 votes

Answer:

809.915$

Explanation:

Amount of money = Principal x e^(rate x year)

= 600 x e^(0.05 x 6)

= 809.915$

User Yuncy
by
5.4k points