Nancy borrows $5000 at a rate of 16% interest per year. What is the amount due at the end of 5 years if the interest is compounded continuously?

Question

Mathematics

Tobias Davila

10 February, 20:21

Nancy borrows $5000 at a rate of 16% interest per year. What is the amount due at the end of 5 years if the interest is compounded continuously?

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Answers (1)

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Jimena Ibarra · Answer 1

A = p (1 + r*t)

A = Amount

p = Principal (5000)

r = rate (0.16)

t = time (5)

A = 5000 (1 + 0.16*5)

A = 5000 (1 + 0.8)

A = 5000 (1.8)

A = 9000

Therefore she will need to pay $9000 at the end of 5 years.