00:01
So recall that there's two different types of compound interest.
00:03
There's finitely compounded.
00:05
So compounded a certain number.
00:08
I can count how many times it's compounded a year versus continuously compounded every second of every hour of every day.
00:16
So financially, my output equals my principal, what i initially invest in, one times one plus my interest rate.
00:24
And is the number of times compounded per year, raised the n times t in years.
00:28
Versus continuously every second of every hour of every day.
00:32
Principal amount times e to the rte is a constant.
00:37
Since i'm compounding monthly, my end values 12, so this is countable, so it's finitely.
00:44
I invest $9 ,500.
00:48
What's my interest rate? 8 .14%.
00:52
But again, in percent always right as a decimal, divide by 100.
00:56
0 .814, all divided by number times compounded 12.
01:04
How much is going to be in that account in 20 years times 20? so i'm plugging in 20, and i can just plug this all in my calculator.
01:13
So work from the inside out...