Luther opened a savings account and deposited 200.00. The account earns 13% interest, compounded continuously. If he wants to use the money to buy a new bicycle in 1 year, how much will he be able to spend on the bike?

Solution

Solution

Amount : 227.77

Solution steps

Translate the problem into an equation:

A = 200 e^{0.13 \cdot 1}

200 e^{0.13 \cdot 1} = 227.76567 \dots

Round to the nearest hundredth:

227.77

Amount : 227.77

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