Question 248847: If 5000 dollars is invested in a bank account at an interest rate of 4 per cent per year, find the amount in the bank after 10 years if interest is compounded annually
Find the amount in the bank after 10 years if interest is compounded quaterly
Find the amount in the bank after 10 years if interest is compounded monthly
Finally, find the amount in the bank after 10 years if interest is compounded continuously
please help thank you!
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! If 5000 dollars is invested in a bank account at an interest rate of 4 per cent per year, find the amount in the bank after 10 years if interest is compounded annually
Find the amount in the bank after 10 years if interest is compounded quarterly
A(10)=5000(1+(0.04/4))^(4*10)
A(10)=5000(1.01)^(40) = $7444.32
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Find the amount in the bank after 10 years if interest is compounded monthly
A(10)=5000(1+(0.04/12))^(12*10)
A(10)=5000(1.0033)^120 = $7424.50
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Finally, find the amount in the bank after 10 years if interest is compounded continuously
A(t)=Pe^(rt)
A(10)=5000*e^(0.04*10)
A(10)=5000(1.4918) = $7459.12
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Cheers,
Stan H.
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