Question

Amelia invested $1,700 in an account paying an interest rate of 1.6% compounded continuously. Assuming no deposits or withdrawals are made, how much money, to the nearest ten dollars, would be in the account after 11 years?

Answer 1

Total amount in account after 11 years is $ 2027.14

Solution:

Given that Amelia invested $1,700 in an account paying an interest rate of 1.6% compounded continuously

To find: Total amount in the account after 11 years

The total amount formula for compounded continuously 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 = 1700

$r = 1.6 \% = \frac{1.6}{100} = 0.016$

t = 11 years

Substituting the values in formula we get,

$A = 1700e^{0.016 \times 11}\\\\A = 1700e^{0.176}\\\\A = 1700 \times 1.1924\\\\A = 2027.14$

Thus total amount in account after 11 years is $ 2027.14