Thinking Mathematically (6th Edition)

Published by Pearson
ISBN 10: 0321867327
ISBN 13: 978-0-32186-732-2

Chapter 8 - Personal Finance - 8.4 Compound Interest - Exercise Set 8.4: 44

Answer

After 212 years, the value of the investment would be $\$150,306,590,169$

Work Step by Step

This is the formula we use when we make calculations with compound interest: $A = P~(1+\frac{r}{n})^{nt}$ $A$ is the final amount in the account $P$ is the principal (the amount of money invested) $r$ is the interest rate $n$ is the number of times per year the interest is compounded $t$ is the number of years We can find the total value of the investment after 212 years when invested at a rate of 6% compounded daily. $A = P~(1+\frac{r}{n})^{nt}$ $A = (\$450,000)~(1+\frac{0.06}{360})^{(360)(212)}$ $A = \$150,306,590,169$ After 212 years, the value of the investment would be $\$150,306,590,169$
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