+0  
 
0
107
2
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In

18501850​,

a person sold a house to a lady for

​$2828.

If the lady had put the

​$2828

into a bank account paying

44​%

​interest, how much would the investment have been worth in the year

20102010

if interest were compounded in the following​ ways?

 

a. monthly                 b. continuously

 Apr 4, 2020
edited by Guest  Apr 4, 2020
 #1
avatar+23695 
+1

I will say it is 160 years     EDITED: CHANGED YEARS FROM 170 to 160

 

monthly      interest is   4 /12 = .3333 %    = .003333      28 (1.00333)(160 * 12) = 16672.20

 

continuously  =   28 ert  = 16851.66

 Apr 4, 2020
edited by ElectricPavlov  Apr 5, 2020
 #2
avatar
0

2010 - 1850 = 160 years


N=160*12; R=0.04/12;PV=28; P =0; FV=PV*(1 + R)^N; print"FV =$",FV
N=160; R=0.04081077;PV=28; P =0; FV=PV*(1 + R)^N; print"FV =$",FV


FV =$ 16673.26 compounded monthly
FV =$ 16851.66 compounded continuously


Note: I took the purchase price of the house as $28 and not $2828 as you have it.

 Apr 4, 2020
edited by Guest  Apr 4, 2020

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