SOLUTION: Hello everyone, i need help with this question. Happy Thanksgiving and god bless. If $1000 is deposited in an account that earns 6.3% interest compounded continuously, how much

Algebra ->  Finance -> SOLUTION: Hello everyone, i need help with this question. Happy Thanksgiving and god bless. If $1000 is deposited in an account that earns 6.3% interest compounded continuously, how much      Log On


   

Question 927752: Hello everyone, i need help with this question. Happy Thanksgiving and god bless.
If $1000 is deposited in an account that earns 6.3% interest compounded continuously, how much will be in the account after 3 years? Can someone explain to me the formula used and how you came up with the answer? thank you
Answer by MathLover1(20850) About Me  (Show Source):
You can put this solution on YOUR website!
Continuous Compound Interest Formula

A=P%2Ae%5E%28rt%29 where,
P = principal amount (initial investment)
r = annual interest rate (as a decimal)
t = number of years
A = amount after time t
An amount of $1000.00 is deposited in a bank paying an annual interest rate of 6.3% , compounded continuously. Find the balance after 3+years.
P+=1000.00
r=6.3%2F100=0.063
t=3years

A=1000.00%2Ae%5E%28r%2At%29
A=1000.00%2Ae%5E%280.063%2A3%29
A=1000.00%2Ae%5E%280.189%29
A=1000.00%2A1.20804
A=1208.04 amount after time 3years