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How much should be deposited into an account today if it is to accumulate to $\$ 950 dollars in 6 years if the account bears interest at $4.25 \%$ compounded(a) monthly, (b) daily, (c) continuously?

(a) 736.50(b) 736.18(c) 736.17

Algebra

Chapter 4

Exponential and Logarithmic Functions

Section 3

The Number $e$

Missouri State University

University of Michigan - Ann Arbor

Lectures

03:24

How much should be deposit…

03:09

03:00

05:14

A sum of $\$ 3000$ is plac…

03:08

$\$ 500 dollars is deposit…

06:29

Suppose \$ 1000$ is invest…

0:00

03:36

03:05

Find the amount of money i…

02:18

If you invest $\$ 5,250$ i…

01:56

If you invest $\$ 7,500$ i…

04:16

A woman invests $\$ 6500$ …

01:27

02:48

Suppose $\$ 4,000$ is inve…

There's another problem where you're practicing your compound interest formula. Look, something like this, uh, or compounding continuously is the performer p e to the r. T. Um, Now, as we read through the problem, what they want you to do is actually, uh, solve for peace. So we don't know the starting amount, but it's a multiplication problem on if we know the ending amount, we can just divide that piece over and the same thing on this one. A divided by e to the r T power will give me P eso as I work through the problem and part A is asking for monthly. Yeah, we just have to figure out OK, well, if we want $950 um, at an interest rate ah, 4.25 So change that 4.25 to 0.4 to five. There's 12 months in a year. Um, and we want to invest over the course of six years. The only thing is, you might need to figure out your calculator. And where do you need to put your parentheses? You do have to do the order of operations, you know, maybe figure out that 12 times 6 to 72. 1st, figure out this decimal add toe power, and then take 9 50 divided by, um, But either way you do this, you should get 7. 36 50 $736.50. Um, s o then the difference of part B. Aziz. Everything is the same. The differences that would change monthly to daily. So all of these numbers are the same. Except, you know, you change 12 to 365 in both spots. Still asking for in six years. So as I type that into my calculator 7. 36 18 so it doesn't take as much money. I mean, we're talking about Penny's here a few times. Um, to get to that and then see is a completely different formula. But it's essentially the same thing. You take that 950 divided by E to the 9500.4 to 5 times six power, But again, use your calculator correctly. Um, and, uh, doing it this way, he gets to save you one penny, 7, 36 and 17 cents. There you go. So a B C

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