Question

you invest $3,000 in an account with an interest rate of 5.5% compounded continuously. How much money would be in the account after 5 years? Round your answer to the nearest whole number.

Answer 1

compounded continuously means you will be using this formula:
\[A=A_0e^{rt}\]

Answer 2

There.

Answer 3

A_0 is the initial investment
r is the rate
t is number of years
A is the amount after time t

Answer 4

Ok...I was hoping to involved the asker some in the question.

Answer 5

You both have completely different equations…. now I'm confused.

Answer 6

I got my answer from Algebra.com :/ I suppose it could be wrong, just have myininaya help you out then you decide which one you wanna go with.

Answer 7

okay… i understand the equation.. but where do i plug in what. @myininaya

Answer 8

equations are exactly the same
we just have different letters (they have the same meaning though)

Answer 9

his F is my A
his P is my A_0

Answer 10

would it be a_0 =3,00 r = 5.5 and t = 5?

Answer 11

3,000*

Answer 12

yes 3000 is the initial investment
r=0.055
t=5

Answer 13

r=0.055 because we had r was 5.5% not 5.5

Answer 14

percent means /100

Answer 15

5.5/100=0.055=r

Answer 16

ohh. okay, i understand that.. so then id take a=3,000^(0.055)(5) ?

Answer 17

close you are missing one little thing

Answer 18

\[A=3000e^{0.055 \cdot 5}\]

Answer 19

whats the e for…?

Answer 20

\[A=A_0e^{rt}\]
e is the base you use if is compounded continuously

Answer 21

if it isn't compounded periodically we would use
\[A=A_0(1+\frac{r}{n})^{nt}\]
where n is the number of compounding periods per year

Answer 22

\[\lim_{n \rightarrow \infty}A_0(1+\frac{r}{n})^{n t}=A_0e^{rt}\]

Answer 23

you don't need to know that last thing

Answer 24

but it why we use e

Answer 25

the explanation is a calculus topic

Answer 26

and I made a type-o above
if it compounded periodically* (not isn't )

Answer 27

if it is compounded periodically we would use
\[A=A_0(1+\frac{r}{n})^{nt}\]
where n is the number of compounding periods per year
*