find-the-effective-rate-of-interest-for-6-compounded-continuously-3

Question

Find the effective rate of interest.
For $6 \%$ compounded continuously

Neel Faucher · Accepted Answer

So in this question, we&#x27;re asked to find the effective rate of interest on we&#x27;re told that it is compounded continues. We know immediately they were going to use this equation. Where is a constant eyes to given interest rate on ours? Effective rate of interest, which is what we&#x27;re trying to find. So, given I toe, 6% is your six. And so it could just put that in to our equation. Each part soup into six minus one. That would give us a final answer. You&#x27;re 68 which is equal to 6.18%.

Neel Faucher · Answer

in this question grass to find the effective rate of interest. So we know immediately that we must use this equation. Are presents the effective, effective, great of interest. Eyes given rate and n is the number of compounds per year because first, write down all information that&#x27;s given so 6% compounded monthly. Therefore, I is you got to 6% which is equal to 0.6 And is he going to 12 since we&#x27;re told that is compound monthly 12 months in a year. Now let&#x27;s go ahead and put all of this information into the equation and just solve our R is equal to one plus your 0.0 6/12 to the power of 12. Nice one. Therefore, our is equal to Ju Ju six one seven for display. Listen to calculate, which is equivalent to 6.1 7%. It&#x27;s that is your final

Emily Frampton · Answer

So I know that I want to have an effective rate of interest. No. 6%. So what? I wanna know what interest rate compounded continuously will give me that affect her re. So I&#x27;m gonna dio, um, normally, like what I would do to find my effective rate with compound continuously, you know, the are. And that&#x27;s gonna equal my, um, one plus my 0.6 Or, you know, there are equals 1.6 So in this case, I need this are out of the exponents. So I&#x27;m going to take the natural longer, both sides. So then there&#x27;s a property of log rhythms that says I can take this exponents down in front of my lager them. So I&#x27;m gonna have our then the natural long of he is the same as one. Well, I&#x27;m going to write that and then So articles. Actually, 1.6 And if I plug the natural order one points or six into my calculator, I get 0.58 or 5.8%

Kayleah Tsai · Answer

let&#x27;s say that you are willing to pay an effective interest rate of 6% and you want to find out how much the annual interest rate, if compound and continuously, would be if you want to pay an effective interest rate of 6%. So basically, you just need to find an annual interest rate that has a NIF effective interest rate of 6%. So let&#x27;s recall the effective interest rate formula when compounded continuously. That would be our e equals e to the R minus one. What are is given to us as 6% and we&#x27;re solving for our So let&#x27;s plug in 0.6 into our formula equals E T. R. Minus one. I had one to both sides, so we have 1.6 equals he into the are we need to break or down. So let&#x27;s take the El Anna both sides Ellen of 1.6 It&#x27;s the safety is l and need to the are This will cancel out and the exponents will be brought down. So let&#x27;s plug in l and of 1.6 into a calculator. So we have so 0.5 eight 27 equals R or the annual interest rate equals 5.8 to 7%

Emily Frampton · Answer

Okay, so let&#x27;s say that I have an interest rate that&#x27;s 6% compounded monthly, and I want to find my effective rate of interest. So what I wanna dio is I&#x27;m gonna take one. Plus, my interest rates, in this case is point there. Six divided by how many times it&#x27;s compound ID per year. So it&#x27;s month lace ups 12 times. There&#x27;s 12 months a year and and raise it to, um, the number of times com pounded. So then that point is there. Six, right, 12 his 120.5 I&#x27;d want to it 1.5 Then I&#x27;m going to raise it to the 12th and always plug about in my calculator. So this is gonna equal one point. 06 17 So if I want to change this inter percentage, I&#x27;m going to subtract one and then I&#x27;ll get 0.617 or 6.17%

Emily Frampton · Answer

All right, So let&#x27;s say an interest rate of 6% compound it continuously, and I want to find the effective interest rate. So the sun is actually pretty easy. So normally, if us using the competent continuously, I would use this formula of pert. So I&#x27;m gonna dio pretty much the same thing to find the effective interest rate. But I only need to take this little part of it, so I&#x27;m just going Teoh he Teoh point there. Six could always change your interest rates to decimals. So I guess my percent just two decibels and then I&#x27;m just gonna put that on my calculator. And here I&#x27;m going to get 1.6 18 So none If I want to change that back Teoh percentage, I would subtract one from it. So I get 0.0 618 and then move my desk. Well, place to to the right or 6.18%.

Problem

Determine the rate that represents the better dea…

Problem 26 Easy Difficulty

Find the effective rate of interest.
For $6 \%$ compounded continuously

Answer

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