Precalculus: Concepts Through Functions, A Unit Circle Approach to Trigonometry (3rd Edition)

Published by Pearson
ISBN 10: 0-32193-104-1
ISBN 13: 978-0-32193-104-7

Chapter 4 - Exponential and Logarithmic Functions - Section 4.7 Financial Models - 4.7 Assess Your Understanding - Page 346: 13


$ \$ 1246.08$

Work Step by Step

Recall: Continuous Compounding Formula $$A = P e^{r t}$$ where $P:$ The principal amount $r:$ Annual interest rate $t:$ Number of years $A:$ Amount after $t$ years The given problem has: $P= \$ 1000, r = 0.11, t=2$ Thus, using these values and the formula above gives: $A = 1000 \times e^{0.11 \times 2}$ $A \approx \$ 1246.08$
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