Use the continuous compound interest formula to find the indicated value. A=​$16,142​; P=​$12,200​; t=36 ​months; r=​?

Question

Use the continuous compound interest formula to find the indicated value.

A=​$16,142​; P=​$12,200​; t=36 ​months; r=​?

r=__________​%

​(Round to three decimal places as​ needed.)

Answer 1

for continuous compounding on this one you want to use the formula

A = Pe^(rt)

meaning that for this scenario we can solve for "r" then plug in the values

r = ln(A/P) / t

r = ln(16142 / 12200) / 3

r = 0.0933 = 9.33%

Answer 2

16142 = 12200e^36t

1.323114754 = e^36t

ln 1.323114754 ≈ 36t