Question

How much would $600 be worth after 10 years, if it were invested at 4%

Answer 1

The worth after 10 years if it were invested at 4%  interest compounded continuously is $ 895.094

Solution:

Given that $ 600 invested at 4 % interest compounded continously for 10 years

To find: total amount after 10 years

The compound interest formula for compounded continously is given as:

$A = p e^{rt}$

Where "p" is the principal

"r" is the rate of interest

"t" is the number of years

Here in this problem, p = 600

$r = 4 \% = \frac{4}{100} = 0.04$

t = 10 years

Substituting the values in formula we get,

$A = 600 e^{0.04 \times 10}\\\\A = 600 e^{0.4}\\\\A = 600 \times 1.49182469764\\\\A = 895.094$

Thus the worth after 10 years is $ 895.094