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$\$ 4750 dollars is deposited into an account for 20 years. Determine the accumulation if interest is $7.23 \%$ compounded (a) monthly, (b) daily, (c) continuously.

(a) 20,081.64(b) 20,166.07(c) 20,168.96

Algebra

Chapter 4

Exponential and Logarithmic Functions

Section 3

The Number $e$

Campbell University

Oregon State University

University of Michigan - Ann Arbor

Lectures

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$\$ 1250$ is deposited int…

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Compound Interest A princi…

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02:10

Find the interest earned o…

A principal of $ \$ 250…

07:18

$\begin{array}{l}{\text { …

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Use the appropriate compou…

The whole premise of this problem is understanding compound interests, which this is the formula. And I'll explain each number as we as we do this versus compound continuously, which is the perform. Sometimes you're sticking a in front. Just say that ending balance is equal to the principal. Yeah, it's really up to you eso in part A when we're doing monthly. The main thing is that there's 12 months in a year. Eso that's what's different about this problem from three other ones is we're starting with 47 50. The rate in this problem you is Ah, 7.23%. Well, you better change that percent two decimal. So move the desk over twice because the word percent means out of the hundreds divide by 100 there, Uh well, uh, compound ings for the monthly and then 12 times 20 years, 20 years. Now, some calculators. You actually have to multiply that first or put parentheses. And you can see that after 20 years, that 47 50 turns into 20,000 $81. You can see why we expected to use a calculator and 64 cents, whereas part B, when we do daily. All of that information is the same. Uh, you know, 47. 50. Still one plus 10.7 to 3. Except now there's 365. Compounding is in a year. You divide by 365 because it's daily times of 365 times 20 power. Andi, this answers a little bit bigger. Not not a whole lot, but 20,000, 166 and seven cents. But again, if you're stuck with your calculator, might need to use parentheses there, whereas when we do continuously, that's using a completely different formula. That is, it starts with 47 50 but then you type in E to the 0.723 times 20 power. And again your calculator might need to use parentheses on you. Get an answer that's a little bit bigger than daily 1 20,068 should be putting dollar signs in here. I just don't like writing Calmus in 96 cents, so the A B C. Make sure you know how to use your calculator, because that's more important than anything

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