(a) If $10,000 is invested at 6%, compounded continuously, find an equation for the future value of...
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(b) What is the future value of the investment after 1 year? After 5 years?
(c) How long will it take for the investment to double?
When interest is compounded continuously, the rate of change of the amount x of the investment is proportional to the amount present. In this case, the proportionality constant is the annual interest rate r (as a decimal); that is, dx/dt = rx
Future Value
Future value (FV) is the value of a current asset at a future date based on an assumed rate of growth. The future value (FV) is important to investors and financial planners as they use it to estimate how much an investment made today will be worth...
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Mathematical Applications for the Management Life and Social Sciences
ISBN: 978-1305108042
11th edition
Authors: Ronald J. Harshbarger, James J. Reynolds
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