SOLUTION: An initial deposit of $38,000 grows at an annual rate of 6% for 20 years. Compare the final balances resulting from continuous compounding and annual compounding. (Round your answe

Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: An initial deposit of $38,000 grows at an annual rate of 6% for 20 years. Compare the final balances resulting from continuous compounding and annual compounding. (Round your answe      Log On

Ad: Over 600 Algebra Word Problems at edhelper.com


    

Question 999439: An initial deposit of $38,000 grows at an annual rate of 6% for 20 years. Compare the final balances resulting from continuous compounding and annual compounding. (Round your answers to the nearest cent.)
Answer by rfer(16322) About Me  (Show Source):
You can put this solution on YOUR website!
FV=38000(1.06)^20
FV=38000(3.207)
FV=$121870.00 annual
----------
FV=38000(2.7183)^(0.06*20)
FV=38000(2.7183)^1.2
FV=38000(3.320)
FV=126160.00 continuous