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Lester deposited 8,815.00 into a new savings account that earns interest compounded continuously. After 10 years, the balance in the account was 32,646.00. What was the interest rate on the account?

Solution

Lester deposited 8, 815.00 into a new savings account that earns interest compounded continuously. After 10 years, the balance in the account was 32, 646.00. What was the interest rate on the account?

Solution

Rate : 13.09267 \dots %

Solution steps

Translate the problem into an equation:

32646 = 8815 e^{r \cdot 10}

Solve for

r, 32646 = 8815 e^{r \cdot 10} : r = 13.09267 \dots %

Rate : 13.09267 \dots %

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