Answer: the balance after 8 years is
$2103
Step-by-step explanation:
The formula for continuously compounded interest is
A = P x e (r x t)
Where
A represents the future value of the investment after t years.
P represents the present value or initial amount invested
r represents the interest rate
t represents the time in years for which the investment was made.
e is the mathematical constant approximated as 2.7183.
From the information given,
P = 1250
r = 6.5% = 6.5/100 = 0.065
t = 8 years
Therefore,
A = 1250 x 2.7183^(0.065 x 8)
A = 1250 x 2.7183^(0.52)
A = $2103 to the nearest dollar
