Alang is going to invest in an account paying an interest rate of 5.7% compounded continuously. How much would Alang need to invest, to the nearest dollar, for the value of the account to reach 113,000 in 5 years?

Solution

Alang is going to invest in an account paying an interest rate of 5.7% compounded continuously. How much would Alang need to invest, to the nearest dollar, for the value of the account to reach 113, 000 in 5 years?

Solution

Principal : 84977.61

Solution steps

Translate the problem into an equation:

113000 = P e^{0.057 \cdot 5}

Solve for

P, 113000 = P e^{0.057 \cdot 5} : P = 84977.61

Principal : 84977.61

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