Question

A person places $73700 in an investment account earning an annual rate of 5.5%, compounded continuously . Using the formula V = P * e ^ (rt) , where V is the value of the account in t years, P is the principal initially invested , e is the base of a natural logarithm, and r is the rate of interest, determine amount of money, to the nearest cent , in the account after 11 years .

Answer 1

The amount in the account after 11 years is $134,963.29

Explanation:

Here, we want to determine the amount in the account after 11 years

What we have to do here is to substitute P for the amount invested which is $73,700

r is the rate given as 5.5% = 5.5/100 = 0.055

t is the time given as 12 years

substituting these values, we have;

V = 73,700 * e^(12* 0.055)

V = $134,963.29