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Nuetrik [128]
4 years ago
8

How much would $500 invested at 5% interest compounded continuously be worth after 8 years? Round your answer to the nearest cen

t.
A. $738.73
B. $709.58
C. $700.00
D. $745.88
Mathematics
1 answer:
attashe74 [19]4 years ago
5 0
Okay so the equation for compound interest is A = P(1 + r/n)^nt.

P<span> =</span><span> principal amount (the initial amount you borrow or deposit)</span>

r<span>  = </span>annual rate of interest (as a decimal)

t<span>  = </span>number of years the amount is deposited or borrowed for.

A<span> =</span><span> amount of money accumulated after n years, including interest.</span>

n  =  number of times the interest is compounded per year 

When interest is compounded continually (i.e. n --> ), the compound interest equation takes the form:<span>P = Ce^<span>rt

So you have to use this formula. 

so C is 500, e is the In function on the calculator, r is 0.05 and t is 8 
Substitute into the formula and you have your answer

Hope this helps</span></span>
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