If 4000 is invested at a rate of 68 showing the setup find t

If $4,000 is invested at a rate of 6.8% showing the setup, find the amount in the account after... a) one year simple interest b) 5 years, compounded quarterly c) 5 years compounded continuously

Solution

Dear Student Thank you for using Chegg !! Given Principal Amount Invested (P) = 4000 $ Rate Of Interest (\'r) = 6.80% To Calculate Amount in account after a) One year simple Interest Simple Interest = P * R * T /100 = 4000*6.8*1/100 = 272 $ Amount = Principal + SI = 4000 + 272 = 4272 $ b) 5 years compounded quarterly Amount = P (1 + r/100n)^nT (Quarterly means n = 4, T =5) = 4000* (1 + 6.8/400)^(5*4) = 5603.754 $ Solution c) 5 years Compounded continuously Amount = P * e^ (rt) = 4000*e^ (0.068*5) = 5619.79 Solution