An initial amount of \$3100 is invested in an account at an interest rate of 3.5% per year, compounded continuously. Assuming that no withdrawals are made, find the amount in the account after three years.

Solution

implicit derivative

ini t ia l am o u n t o f $3100 i s in v es t e d in an a cco u n t a t an in t eres t r a t e o f 3.5% p er ye a r, co m p o u n d e d co n t in u o u s l y . A ss u min g t ha t n o w i t h d r a w a l s a re ma d e, f in d t h e am o u n t in t h e a cco u n t a f t er t h ree ye a rs .

Amount : 3443.2

Solution steps

Translate the problem into an equation:

A = 3100 e^{0.035 \cdot 3}

3100 e^{0.035 \cdot 3} = 3443.20289 \dots

Round to the nearest hundredth:

3443.2

Amount : 3443.2