If you are going to invest 1114 in an account earning 8 int

If you are going to invest $1114 in an account earning 8 % interest over 10 years, how much more will you earn from an account offering interest compounded continuously over an account earning interest compounded quarterly? (Round to the nearest dollar)

Solution

Dear Student Thank you for using Chegg !! Given Data Principle (P) = 1114 $ Interest (\'r) = 8% Time = 10 years When Compounded Quarterly ( n = 4) A = P (1 + r/100n)^nt = 2459.756185 $ When Compounded Continuously A = P e^rt = 1114*e^0.08*10 = 2479.252594 $ Difference between compounded continuously - Compounded Quarterly = 19.49640907 $ = 20 $ Solution