If $740 is invested at an interest rate of 11% per year and is compounded continuously, how much will the investment be worth in 7 years?Use the continuous compound interest formula A = Pert.

Accepted Solution

Answer:[tex]\$1,598.23[/tex]  Step-by-step explanation:we know that The formula to calculate continuously compounded interest is equal to [tex]A=P(e)^{rt}[/tex]  where  A is the Final Investment Value  P is the Principal amount of money to be invested  r is the rate of interest in decimal  t is Number of Time Periods  e is the mathematical constant number we have  [tex]t=7\ years\\ P=\$740\\ r=0.11[/tex]  substitute in the formula above  [tex]A=\$740(e)^{0.11*7}[/tex]  [tex]A=\$1,598.23[/tex]