Suppose $18,000 is invested in a savings account which grows to $45,000 in 10 years. Determine the interest rate for this account if the interest is compounded continuously. Leave your answer in exact form. Show all work toward your solution.
Added by William U.
Close
Step 1
Step 1: We know that the formula for continuous compounding is A = P * e^(rt), where A is the final amount, P is the principal amount, r is the interest rate, and t is the time in years. Show more…
Show all steps
Your feedback will help us improve your experience
Steven Clarke and 80 other Precalculus educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
Adi S.
Find the interest rate needed for an investment of $9,000 to grow to $12,000 in 5 years if interest is compounded continuously. (Round your answer to the nearest hundredth of a percentage point.) _______________________%
Nick J.
Compute the simple interest for the specified length of time and the future value at the end of that time. Round all answers to the nearest cent. [HINT: See Quick Examples 1-5.] You borrow $\$ 12,000$ for 10 months at $0.05 \%$ per month.
The Mathematics of Finance
Simple Interest
Recommended Textbooks
Precalculus with Limits
Precalculus
Transcript
18,000,000+
Students on Numerade
Trusted by students at 8,000+ universities
Watch the video solution with this free unlock.
EMAIL
PASSWORD