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Terrence opened a savings account and deposited 800.00. The account earns 15% interest, compounded continuously. If he wants to use the money to buy a new bicycle in 3 years, how much will he be able to spend on the bike?

Solution

Solution

Amount : 1254.65

Solution steps

Translate the problem into an equation:

A = 800 e^{0.15 \cdot 3}

800 e^{0.15 \cdot 3} = 1254.64974 \dots

Round to the nearest hundredth:

1254.65

Amount : 1254.65

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