Question

Ivan invested $2,900 in an account with nominal annual interest rate of 8%, compounded continuously. What is the account balance after 4 years?

Answer 1

Answer:

The amount would be $ 3993.67 (approx)

Step-by-step explanation:

Given,

The invested amount or principal amount, P = $ 2,900

The annual rate of interest, r = 8% = 0.08,

Since, the amount formula in compound continuously interest,

$A=P e^{rt}$

Where,

t = number of years,

Hence, the account balance after 4 years,

$A=2900 e^{0.08\times 4}=2900 e^{0.32}\approx \ 3993.67$