SOLUTION: A principal of $2000 is invested at 10% interest compounded continuously. After how many days will the investment first exceed $2100?
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Question 1072606: A principal of $2000 is invested at 10% interest compounded continuously. After how many days will the investment first exceed $2100?
Answer by jorel1380(3719) (Show Source): You can put this solution on YOUR website!
If the interest is compounded continuously, then we need an effective yearly interest rate. So
A=p x e^rt where r is the yearly interest rate. So after one year, the interest rate is:
2100=2000 x e^.1t
21/20=e^.1t
log 1.05=log e^.1t
log 1.05=.1t log e
t=log 1.05/.1 log e
t=0.48790164169432003065374404223165 yrs, or 178.2 days. ☺☺☺☺
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