00:02
Here we have a compound interest problem, and for the first part, the first five parts, we're going to use the non -continuous compounding formula, and for the last part, we'll use the continuous compounding formula.
00:13
So when n equals 1, that means one compounding per year, that would be annual interest.
00:18
We have a equals 2 ,500 times 1 plus 0 .035, that's our interest rate converted to a decimal, raised to the tenth power.
00:28
And for that we get $3 ,526 .50.
00:35
For n equals 2, this would be compounding twice a year.
00:38
We call that semi -annual.
00:40
So a equals 2 ,500 times 1 plus 0 .035 divided by 2, raised to the power 2 times 10.
00:48
And we get $3 ,536 .95.
00:54
For n equals 4, this is four times a year, quarterly compounding, they call it.
01:00
And we have a equals 2 ,500 times 1 plus 0 .035 over 4 raised to the 4 times 10...