SOLUTION: Suppose $18000 is initially invested in an account with an APR of 4.5%. If interest is compounded continuously, how much interest does the account earn over the first 10 year

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Question 997782: Suppose $18000 is initially invested in an account with an APR of 4.5%.

If interest is compounded continuously, how much interest does the account earn over the first 10 years?
Thank you!
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
continuous interest, i beieve, is modeled by the equation:

f = p * e^(rn)

f is the future value
p is the present value
r is the interest rate per time period.
n is the number of time periods.

you are investing 18,000 at 4.5% per year for 10 years using continuous compounding.

the formula becomes f = 18,000 * e^(.045*10) which makes f = 28229.61934