Question 533903
If $100 dollars is deposited in a savings account that pays interest at a rate of 12.5% per year compounded continuously, find the balance after 13 years.



Formula for continuous compounding is: {{{A = Pe^rt}}}, where A = future value, P = principal, or original amount invested, e = 2.7182818, r = interest rate, and t = time (in years)


{{{A = Pe^rt}}}


{{{A = 100(2.7182818)^((.125*13))}}}


A = 100(5.078418951)


A, or future value, or balance after 13 years = ${{{highlight_green(507.84)}}}


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