Question

** POR FAVOR WILL FAN AND MEDAL**
Situation: You invest $900 in an account that pays an interest rate of 5.5%, compounded continuously. Calculate the balance of your account after 6 years.

Answer 1

Do you know what compound interest is? Can you tell me a formula we can use here?

Answer 2

I can give a formula.

Answer 3

A=PE\[A=PE ^{rt}\] - A being amount
- P being principal
- E being mathematical constant
- r being intrest
- t being time in years

Answer 4

I got 1251.87 is that right?

Answer 5

Not sure, how did you get that answer. Where did you place the numbers?

Answer 6

Never used the equation, so...still trying to understand the equation myself right now.

Answer 7

Are you doing online school?

Answer 8

I am.

Answer 9

Algebra 2 class? That's what I'm on

Answer 10

Algebra 1

Answer 11

IT WAS RIGHT, THANK THE HEAVENS!

Answer 12

I got 29,700 can't be right. Here is how I inserted the numbers.
\[A=900*1^{5.5*6}=X\]

Answer 13

It told me I got it right so I guess I did get it right .

Answer 14

Lol, alright. As I was saying I am still trying to figure out how you got it right.

Answer 15

Click equation punch in the numbers and post it. maybe I can get it then.

Answer 16

FV=(900)(2.71828)^(0.055*6)

Answer 17

FV?

Answer 18

\[FV=(900)(2.71828)^{(0.055*6)}\]

How did you get 2.71?

Answer 19

The numbers were 900/5.5/6 where did 2.71 come from?

Answer 20

FV=future value
PV=present value
r= annual rate of interest (in decimal not percent)
t=time in years
e=constant, 2.71828

Answer 21

Ah

Answer 22

\[FV=(PV)*(e)^{r*t}\]

Answer 23

r*t are in one parenthesis

Answer 24

So, what is the equation on acquiring the constant.

Answer 25

David, you made a slight mistake. The interest is 5.5% but as a decimal, that is 0.055 not 5.5. This means that for ever year the interest is added, the principal increases by a factor of 1.055. $900 over 6 years would be \[$900\times1.055^6=$1240.96\]