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Suppose an investment account is opened with an initial deposit of $13,500 earning 4.75% interest, compounded continuously. How much will the account be worth after 25 years? (Round your answer to two decimal places.)

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SOLUTION

Gicen:

Suppose an investment account is opened with an initial deposit of $13,500 earning 4.75% interest, compounded continuously. How much will the account be worth after 25 years? (Round your answer to two decimal places.)

Using the formula:

[tex]\begin{gathered} A=Pe^{rt} \\ A=? \\ P=\text{ \$13500} \\ r=\frac{4.75}{100}=0.0475\text{ \%} \\ t=25years \end{gathered}[/tex][tex]\begin{gathered} A=13500e^{25(0.0475)} \\ A=44264.80 \end{gathered}[/tex]

Final answer:

44264.80