SOLUTION: Use a=p(1 + r/n)^nt + a=Pe^rt to solve
Suposse that you have $7000 to invest which investment yeilds the greater return over 8 years:
8.75% compounded continuesly or 8.9% c
Algebra.Com
Question 79064: Use a=p(1 + r/n)^nt + a=Pe^rt to solve
Suposse that you have $7000 to invest which investment yeilds the greater return over 8 years:
8.75% compounded continuesly or 8.9% compunded semiannually?
Answer by rapaljer(4671) (Show Source): You can put this solution on YOUR website!
When compounding semiannually, let n= 2 in this formula, P=$7000, t=8, and r=.089
A=$14048.60
When compounding continuously, use this formula, P=$7000, t=8, and r=.0875
A=$14096.27
If I did the calculations right, it looks like the continous compounding at a slightly lower rate came out better!
R^2 at SCC
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