You deposit $3000 in an account that pays 6% annual interest compounded continuously. What is the interest you can get from this account after two years?

Answer 1

The formula for continuous compound interest is A = Pe^rt where A is the final amount, P is our initial amount (principal), r is the interest rate as a decimal and t is time in years. In this problem, we plug in the given information and calculate A = 3000e^.06(2) = 3382.49. The extra $382.49 is the interest accumulated after two years.