Question

How much would $300 invested at 9% interest compounded continuously be worth after 3 years? Round your answer to the nearest cent.

Answer 1

Use the formula A = Pe^(r*t).

A = $300*e^(0.09*3) = $392.99. Sounds like a great deal!

Answer 2

Answer: $392.99

Explanation:

The formula to find the compound amount when it is compounded continuously after x years :-

`A=Pe^(rt)`, where P is the principal amount , r is the rate of interest and t is the time period.

Given : Principal Amount : P = $300

Rate of interest : r= 9%=0.09

Time : t =3 years

Now the the compounded amount after 3 years will be :-

`A=300e^(0.09*3)=392.98933522\approx392.99`

Hence, the compounded amount after 3 years = $392.99