If $600 is deposited in an account paying 11% compounded continously, then what amount will be in the account after 8 years?
I just needed to double check if A=Pe^(rt)
It is better to use the second formula below because e is only correct for large n as the binomial expansion shows: $\displaystyle (1+\frac{1}{n})^n \rightarrow e \: , \: n \rightarrow \infty$
$\displaystyle A(t) = A(0)(1+{x})^{t}$ is a better model
- A(t) = Amount at time t
- A(0) = Amount at time 0
- x = amount of interest in one period
- t = time (number of periods)
$\displaystyle A(t) = 600(1+\frac{11}{100})^8 = \$1382.72$