SOLUTION: Trish invests ​$5000 in her IRA in a bond trust that pays 7​% interest compounded semiannually.Sean invests ​$5000 in his IRA in a certificate of deposit that pay
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Question 1048484: Trish invests $5000 in her IRA in a bond trust that pays 7% interest compounded semiannually.Sean invests $5000 in his IRA in a certificate of deposit that pays 6.9% compounded continuously. Who has more money after 20 years, Trish or Sean?
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
Trish:
A=5000{1+(.07)/2}^40=$19,796.30
Sean
A=5000e^(0.069*20)=$19,874.51
Continuous compounding uses the fact that {1+(1/n}^n=e^n
Sean does.
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