Question

Now that you know that P = 2200, r = 0.053, and t = 7, substitute the values into the continuously compounded interest formula, A = Pert to find out how much you will have in the account after 7 years.How much will you have in the account after 7 years? Round the solution to the nearest dollar.

Answer 1

Answer

3158 dollars

Explanation

Amount obtained from compounded interest is given as

A = P (1 + r)ᵗ

A = Amount to be obtained from the investment at compound interest

P = Initial amount invested = 2200

r = Rate = 0.053

t = Time = 7 years

A = P (1 + r)ᵗ

A = 2200 (1 + 0.053)⁷

A = 2200 (1.053)⁷

A = 2200 (1.4355)

A = 3158 dollars

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