Simplify the following expression.
1 answer:
You might be interested in
Answer:
a)$1628.90
b)$1647.00
c)$1648.72
Step-by-step explanation:
The question is on compound interest.
The formula to apply here is;
where
- P=principal /beginning amount
- r=interest rate as a decimal
- n=number of compoundings a year
- t=total number of years
a) If compounded annually, n=1
p=$1000, r=5%=0.05 t=10
Amount will be;
Amount=$1628.90
b) If compounded monthly, n=12
p=$1000, r=5%=0.05, t=10, n=12
Amount=$1647.00
c)If interest compounded continuously, it means the principal is earning interest constantly and the interest keeps earning on the interest earned.Here the formula to apply is;
A=Pe^rt where e is the mathematical constant e=2.71828182846
Hence the amount will be;
Amount=$1648.72