In this example,
expect that we have $1,000 to place in the financial institution
gaining 4% rate of interest intensified constantly. Just how much cash will
we have after 5 years? Here, we understand the
original quantity of cash that we” re doing away with. It” s$ 1,000. And what we desire to find
is the quantity of cash we have in the end. We saw that the amount of
When intensified constantly is, cash we have at the end
given by the formula p of t equates to p0 times e to the rt. In this specific
trouble, we have that the rates of interest is 4%. We” re worsening continually,
and we placed it in the bank for 5 years. This offers us the formula, the
amount of money after 5 years, p of 5, equates to 1,000
times e to the 0.04 times 5, which, when we assess,
pertains to approximately $1,221.40. So we can end that we
will certainly have $1,221.40 in 5 years if we put away $1,000 today. In other words, over 5
years, we” ll make concerning $220 in interest.
