Suppose you deposit $3000 at 6% interest compounded continously. Find the average value of your account during the first 3 years.

Question

Suppose you deposit $3000 at 6% interest compounded continously. Find the average value of your account during the first 3 years.

Answer 1

f(t) = Pe^rt = 3000*e^.06t (continuous compounding)

We assume that the interest rate is .06 "per year" and t is in "years"

Why not integrate the function with respect to t from 0 to 3 and then divide by 3 to get the average value.

Let me know if that works for you.