Enola is going to invest in an account paying an interest rate of 5.1% compounded continuously. How much would Enola need to invest, to the nearest cent, for the value of the account to reach 12,800 in 10 years?

Solution

Enola is going to invest in an account paying an interest rate of 5.1% compounded continuously. How much would Enola need to invest, to the nearest cent, for the value of the account to reach 12, 800 in 10 years?

Solution

Principal : 7686.34

Solution steps

Translate the problem into an equation:

12800 = P e^{0.051 \cdot 10}

Solve for

P, 12800 = P e^{0.051 \cdot 10} : P = 7686.34

Principal : 7686.34

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