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Popular Word Problems >

A deposit of \$5,000 is made in a trust fund that pays 6.75% interest, compounded continuously. In 50 years how much would the trust fund be worth?

Solution

A d e p os i t o f $5, 000 i s ma d e in a t r u s t f u n d t ha t p a ys 6.75% in t eres t, co m p o u n d e d co n t in u o u s l y . I n 50 ye a rs h o w m u c h w o u l d t h e t r u s t f u n d b e w or t h ?

Solution

Amount : 146121.42

Solution steps

Translate the problem into an equation:

A = 5000 e^{0.0675 \cdot 50}

5000 e^{0.0675 \cdot 50} = 146121.41890 \dots

Round to the nearest hundredth:

146121.42

Amount : 146121.42

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