00:02
Here we have a compound interest problem, and for the first five parts we're going to use the non -continuous compounding formula, and for the last part we use the continuous compounding formula.
00:13
So for the first part, n equals 1, that means one compounding per year.
00:17
We call that annual interest.
00:21
So we have a equals 1 ,000 times 1 plus 0 .06.
00:25
We change the percentage rate to a decimal, raised to the 40th.
00:30
And for that we get 10 ,200 ,000.
00:36
$85 and $72.
00:39
Now if n equals 2, that would be semi -annual compounding two times per year.
00:44
A equals 1 ,000 times 1 plus 0 .06 divided by 2, raised to the power 2 times 40...