SOLUTION: If $100 dollars is deposited in a savings account that pays interest at a rate of 12.5% per year compounded continuously, find the balance after 13 years.

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Question 533903: If $100 dollars is deposited in a savings account that pays interest at a rate of 12.5% per year compounded continuously, find the balance after 13 years.
Found 2 solutions by Kbear, MathTherapy:
Answer by Kbear(1) About Me  (Show Source):
You can put this solution on YOUR website!
100*.125=12.50
12.50*13=
165.50

Answer by MathTherapy(10551) About Me  (Show Source):
You can put this solution on YOUR website!
If $100 dollars is deposited in a savings account that pays interest at a rate of 12.5% per year compounded continuously, find the balance after 13 years.


Formula for continuous compounding is: A+=+Pe%5Ert, where A = future value, P = principal, or original amount invested, e = 2.7182818, r = interest rate, and t = time (in years)

A+=+Pe%5Ert

A+=+100%282.7182818%29%5E%28%28.125%2A13%29%29

A = 100(5.078418951)

A, or future value, or balance after 13 years = $highlight_green%28507.84%29

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