Question

Using the following formula for continuous compounding interest, A=Pe^rt, calculate the amount of interest a credit card with an annual interest rate of 29%would generate in a month if you had a starting amount of 11,000

I just would like to know how to set up this equation

Answer 1

In that equation A is final amount
P is beginning amount
e = 2.718281828
r is the interest rate
t is the time (month would be 1/12 = 0.083333333)


final amount = 11,000 * 2.718281828^(.29*0.083333333)

The final amount will be the interest plus the principal.

Answer 2

but its asking how much the annual interest rate would generate in a month

Answer 3

how would i find that

Answer 4

r = .29 annual rate
r = .29/12 = 0.0241666667 monthly