Question

Ruby invested $300 in an account paying an interest rate of 6.1% compounded continuously. Assuming no deposits or withdrawals are made, how much money, to the nearest hundred dollars, would be in the account after 13 years?

Answer 1

Answer: $663 would be in the account after 13 years.

Step-by-step explanation:

The formula for continuously compounded interest is

A = P x e(r x t)

Where

A represents the future value of the investment after t years.

P represents the present value or initial amount invested

r represents the interest rate

t represents the time in years for which the investment was made.

From the information given,

P = $300

r = 6.1% = 6.1/100 = 0.061

t = 13 years

Therefore,

A = 300 x e(0.061 x 13)

A = 300 x e0.793

A = $663