Question

Andrew deposited $500 in a savings account that offers an interest rate of 6.5%, compounded continuously. Andrew's initial deposit will grow to $543 in ___ months.

Answer 1

Answer:

The answer is 15 months.

Step-by-step explanation:

p = $500

r = 6.5% or 0.065

A = $543

t = ?

The formula to be used here is :

$A=pe^rt$

$t=(log(A/p)/log(e))/r$

Putting the values in formula we get:

$t=(log(543/500)/log(e))/0.065$

$t=(log(1.086)/log(e))/0.065$

This gives t = 1.3 years

In months it will be 1 year(12 months) + 3 months = 15 months.

Hence, the answer is 15 months.