Suppose that interest on money in the bank accumulates at an annual rate of5% per year compounded continuously. How much money should be invested today, so that 20 years from now it will be worth $20000?

(Hint: If you're stuck, then model the account balance B = B(t) with a differential equation and an initial condition, keeping in mind that the initial condition here is not at t = 0.) (see attachment)

Question

Suppose that interest on money in the bank accumulates at an annual rate of5% per year compounded continuously. How much money should be invested today, so that 20 years from now it will be worth $20000?

(Hint: If you're stuck, then model the account balance B = B(t) with a differential equation and an initial condition, keeping in mind that the initial condition here is not at t = 0.) (see attachment)

anonymous · Answer

attachment

anonymous · Answer

here is the differential equation$$\frac{dB}{dt} = 0.05B$$try to solve the DE with the given conditions stated in the problem