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Popular Word Problems >

Find the present value of 2000 payable at the end of 3 years, if money may be invested at 6% with interest compounded continuously.

Solution

solve for

t h e p rese n t v a l u e o f 2000 p a y ab l e a t t h e e n d o f 3 ​ ye a rs, i f m o n ey ma y b e in v es t e d a t 6​% w i t h in t eres t co m p o u n d e d co n t in u o u s l y .

Solution

Amount : 2394.43

Solution steps

Translate the problem into an equation:

A = 2000 e^{0.06 \cdot 3}

2000 e^{0.06 \cdot 3} = 2394.43472 \dots

Round to the nearest hundredth:

2394.43

Amount : 2394.43

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