Precalculus: Mathematics for Calculus, 7th Edition

Published by Brooks Cole
ISBN 10: 1305071751
ISBN 13: 978-1-30507-175-9

Chapter 4 - Section 4.2 - The Natural Exponential Function - 4.2 Exercises - Page 343: 33

Answer

(a) 2145.02 dollars (b) 2300.55 dollars (c) 3043.92 dollars

Work Step by Step

The formula to calculate the value of an investment that is compounded continuously at a given rate is P(t)=Pe^((r)(t)) Where P(t)= the value of an investment at t, P=principal amount, r= rate, and t= time From the question we know that p=2000 and r= .035 giving us the formula P(t)=2000e^((.035)(t)) What is the value of the investment after (a) 2 years P(2)=2000e^((.035)(2)) p(2)= 2145.02 dollars (b) 4 years P(4)=2000e^((.035)(4)) p(4)= 2300.55 dollars (c) 12 years P(12)=2000e^((.035)(12)) P(12)= 3043.92 dollars
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