Question

You invest $1000 in an account. How do you find the value of the accounts after 4 years with a 4.2% interest compounded continuously?

Answer 1

Amount after `4` years will be `1182.94(2dp)`

Explanation:

Formula for continuously compounded amount is `A=P*e^(r/100*t)` ;

P=principal=100 , r =rate of interest=4.2% , t=time=4 yrs ; e=2.71828.

`A=1000*2.71828^(4.2/100*4)=1182.94(2dp)`

Amount after `4` years will be `1182.94(2dp)`[Ans]