SOLUTION: suppose you invest $100 at 7% annual interest. Calculate the amount that you would have after one year if interest is compounded: a) quarterly b) monthly c) continuously

Algebra ->  Exponential-and-logarithmic-functions -> SOLUTION: suppose you invest $100 at 7% annual interest. Calculate the amount that you would have after one year if interest is compounded: a) quarterly b) monthly c) continuously      Log On


   

Question 38927: suppose you invest $100 at 7% annual interest. Calculate the amount that you would have after one year if interest is compounded: a) quarterly b) monthly
c) continuously
Answer by Nate(3500) About Me  (Show Source):
You can put this solution on YOUR website!
a) quarterly
P%28a%29+=+a%281+%2B+r%2Fn%29%5E%28tn%29
P%28a%29+=+100%281+%2B+.01%2F4%29%5E%284%29
P%28a%29+=+101.00
b) monthly
P%28a%29+=+a%281+%2B+r%2Fn%29%5E%28tn%29
P%28a%29+=+100%281+%2B+.07%2F12%29%5E%2812%29
P%28a%29+=+107.23
c) continuously
P%28a%29+=+a%281+%2B+r%29%5Et
P%28a%29+=+100%281+%2B+.07%29
P%28a%29+=+107