Answer:
Step-by-step explanation:
The formula for continuously compounded is:
where P is the principal amount, r is the interest rate as a decimal, and t is the amount of time.
The principal amount is $7,500 and time is 16 years. The interest rate is 1.5%. Convert this to a decimal- divide by 100 or move the decimal places two spots to the left.
- 1.5/100= 0.015 or 1.5 --> 0.15 --> 0.015
Now we know all the values and can substitute them into the formula.
Solve the multiplication in the exponent first.
Solve the exponent.
Round to the nearest cent (hundredth place). The 8 in the thousandth place tells us to the round the 6 to a 7.
The account balance will be <u>$9,534.37</u> after 16 years.