Suppose you invest $200 at an annual interest rate of 2.5% compounded continuously. How much will you have in the account after 2 years?
A.$513.61
B.$27.18
C.$210.25
D.$410.13
c. 1.025^2*200=
$210.25
e^.025=1.025315 - 1 =.025315 X 100=2.5315%-This is the equivalent of 2.5% comp. continuously.
FV=PV(1 + R)^N
FV=200 X 1.025315^2=$210.25 after 2-year growth.
