00:01
One of the problem here, parents are investing $30 ,000 into account, and they wanted to grow to the $180 ,000 when they start college in 15 years.
00:09
So we want to know what's the rate if we're going to continuously compound to meet this goal.
00:15
So since we're compounding continuously, we're going to be using p times e to the rt.
00:20
Where r right now is the unknown.
00:22
So we know the resulting answer is going to be $180 ,000 because that's what our goal is going to be.
00:28
The initial principle in the amount that we're putting in to begin with is the 30 ,000.
00:32
And then it becomes e to the rt.
00:35
R is unknown, but t we know is 15.
00:37
So i'm just going to write this as 15r.
00:40
So the first thing i'm going to do is divide 180 ,000 by 30 ,000, and that's going to isolate the e.
00:46
So 180 divided by the 30 gets me 6.
00:49
So 6 is equal to e to the 15r...