Solve the problem.
-Suppose that $6000 is invested at an interest rate of 5.2% per year, compounded continuously. What is the balance after 2 years?Round to the nearest cent.
A)$6312.00
B)$6757.60
C)$6657.60
D)$6624.00

Question

Quizplus · Accepted Answer

The formula for continuous compounding is $A = Pe^{rt}$, where $A$ is the amount of money accumulated after n years, including interest, $P$ is the principal amount (the initial amount of money), $r$ is the annual interest rate (decimal), and $t$ is the time the money is invested for in years. Plugging in the given values: $A = 6000e^{0.052 \times 2}$, we get $A \approx 6657.60$.

Solve the Problem. -Suppose That $6000 Is Invested at an Interest Rate of Interest