Use the compound interest formula for continuous compounding to determine the accumulated balance after the statedperiod.
-A $5000 deposit in an account with an APR of 4.8% compounded continuously for 6 years. 143)

Question

Quizplus · Accepted Answer

The formula for continuous compounding is $A = Pe^{rt}$, where $A$ is the amount of money accumulated after n years, including interest, $P$ is the principal amount (the initial amount of money), $r$ is the annual interest rate (decimal), and $t$ is the time the money is deposited for in years. For this problem, $P = 5000$, $r = 0.048$, and $t = 6$. Plugging these values into the formula gives $A = 5000e^{0.048 \times 6}$, which calculates to approximately $6668.79.

Use the Compound Interest Formula for Continuous Compounding to Determine