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22 February, 06:16

Andrea davis plans to invest $600 into a money market account. find the interest rate that is needed for the money to grow to $1240 in 14 years if the interest rate is compounded continuously

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  1. 22 February, 10:08
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    The interest rate is 5.2%

    Explanation:

    A = Pe^rt

    A = $1240

    P = $600

    t = 14 years

    1240 = 600e^14r

    e^14r = 1240/600 = 2.067

    e^14r = 2.067

    14r = ln 2.067

    14r = 0.726

    r = 0.726/14 = 0.052 = 5.2%
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