a person sold a house to a lady for
If the lady had put the
into a bank account paying
interest, how much would the investment have been worth in the year
if interest were compounded in the following ways?
a. monthly b. continuously
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.