Some banks now use continuous compounding of an amount invested. In this case, the equation that models the value of an initial

Question

2 years ago

11

Some banks now use continuous compounding of an amount invested. In this case, the equation that models the value of an initial

investment of P dollars in t years at an annual interest rate of r is given by
A = Pe^rt. Using this equation, find the value in 5 years of an investment of $2000 that earns 7% annual interest.

Mathematics

1 answer:

Elza [17] · Answer 1 · 2022-06-04T01:52:22+03:00

Elza [17]2 years ago

5 0

9514 1404 393

Answer:

$2838.14

Step-by-step explanation:

Fill in the values and do the arithmetic.

A = 2000e^(0.07·5)

A = 2000e^0.35 ≈ 2838.14

The value of the investment in 5 years will be $2838.14.