Asked by nik
Assume the initial investment was $6600 and the annual interest
rate to be compounded continuously is 5%. Assume also that
the target amount is $7900.
If you want the account to contain the target amount given above after
9 years, what yearly interest rate is needed?
rate to be compounded continuously is 5%. Assume also that
the target amount is $7900.
If you want the account to contain the target amount given above after
9 years, what yearly interest rate is needed?
Answers
Answered by
Henry
Pt = Po * e^rt,
7900 = 6600 * e^9r,
Divide both sides by 6600:
e^9r = 7900/6600 = 1.1970,
9r = ln(1.1970) = 0.1798,
r = 0.1798/9 = 0.02 = 2%.
7900 = 6600 * e^9r,
Divide both sides by 6600:
e^9r = 7900/6600 = 1.1970,
9r = ln(1.1970) = 0.1798,
r = 0.1798/9 = 0.02 = 2%.
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