The general formula for the 8% compounded continuously is A(t) = , t is the time in years.
The effective rate is the annual growth rate
= = 1.083287009.
In the percentage form, the effective rate is 8.33% (approximately). ANSWER
Solved.
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To see many other similar (and different) solved problems on continuously compounded accounts, look into the lesson
- Problems on continuously compound accounts
in this site.
After reading this lesson, you will tackle such problems on your own without asking for help from outside.
