Question

Find the compound amount and the amount of interest earned by the following deposit. $5100 at 3.2% compounded continuously for 9 years. The future value after 9 years is approximately $ - (Do not round until the final answer. Then round to the nearest cent as needed.)

Answer 1

Answer: The future value after 9 years is $90852.79 .

Compound interest : $85752.79

Explanation:

Formula to find Future value (compounded continuously):-

`F.V.=Pe^(rt)`, where P is the Present Value , r is rate of interest and t is the time period.

Given : Time period : t = 9 years

Present value : P = $5100

Rate of interest = 3.2% = 0.032

Then,
`F.V.=5100e^(0.32(9))`

`F.V.=5100e^(2.88)=5100*17.8142731796\\\\=90852.793216\approx90852.79` [Rounded to nearest cents.]

Compound interest :
`I= F.V.- P`

`90852.79-5100=85752.79`

Hence, the future value after 9 years is $90852.79