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if you invest $5000 into an account that compounds interest continuously and you have 7130.90 after 5 years what is the interest rate

 Apr 10, 2021

Best Answer 

 #2
avatar+118626 
+1

Continuous compounding  formula

 

A = P * e^(r * t)

 

7130.90    =  5000 * e^( r * 5)

 

(7130.90  /  5000)  =  e^( 5r)       take the  Ln  of  both  sides

 

Ln  ( 7130.90  / 5000)  = Ln e^(5r)       and we  can write

 

Ln ( 7130.90  / 5000) =  5r

 

Ln (7130.90 / 5000)   / 5   = r  ≈  7.1%

 

 

cool cool cool

 Apr 10, 2021
 #1
avatar+198 
+2

Hey there, Guest!

 

Let's solve your question:

 

7130.90-5000= 2130.9

 

2130.9/5= $426.18

 

I'm 99% sure that that's your answer.

 

Hope this helped! :)

( ゚д゚)つ Bye

 Apr 10, 2021
 #2
avatar+118626 
+1
Best Answer

Continuous compounding  formula

 

A = P * e^(r * t)

 

7130.90    =  5000 * e^( r * 5)

 

(7130.90  /  5000)  =  e^( 5r)       take the  Ln  of  both  sides

 

Ln  ( 7130.90  / 5000)  = Ln e^(5r)       and we  can write

 

Ln ( 7130.90  / 5000) =  5r

 

Ln (7130.90 / 5000)   / 5   = r  ≈  7.1%

 

 

cool cool cool

CPhill Apr 10, 2021

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