growth....

Question

How much would a person have to invest at 4.5% compounded continuously to have $10,000 five
years from today?

Answer 1

A = Pe^(rt)

 

We have

 

A = 10000

 

r = .045

 

t = 5

 

We are looking for P

 

10000 = Pe^(5*.045)

 

All we need to do is divide both sides by e^(5*.045)

 

10000/e^(5*.045) = P

 

7985.162188 = P

Answer: $7985.16