Posted by **James** on Tuesday, April 8, 2008 at 8:22pm.

A person deposits money into a retirement account, which pays 7% interest compounded continuously, at a rate of $1000 per year for 20 years. Calculate:

a. The balance of the account at the end of 20 years

b. the amount of money actually deposited into the account

c. the interest earned during the 20 years.

I think i know that for part a you use the integral to find the future value maybe, but i have no idea how to do b or c

- Calc -
**FredR**, Wednesday, April 9, 2008 at 1:00am
compound interest formula is:

FV=PV(1+(r/n))^(nT)

As n approaches infinity, this formula becomes:

FV=PV*e^(rt)

for the 1st $1000 invested:

FV=1000*e^(.07*20)

for the 2nd $1000 invested:

FV=1000*e^(.07*19)

and so on for 20 years. The sum total of future values minus $20,000 deposited is the interest earned in the 20 years.

- Calc -
**Kati**, Thursday, February 13, 2014 at 12:07am
a.) $43,645.71

b.) just do 1000*20 =20,000

c.) a-b (43,645.71-20,000=23645.71)

## Answer This Question

## Related Questions

- Finite Math and Applied Calculus - Betty Sue sets up a retirement account. For ...
- math - a bank account earns 7% annual interest compounded continuously. you ...
- differential equation - If P(t) is the amount of dollars in a savings bank ...
- PRE-CALC - If you put $2,000 in a savings account that pays 6% interest ...
- Economics - Ben deposits $5000 now into an account that earns 7.5 percent ...
- geometry - A person deposits $500.00 into a savings account and pays 5% annual ...
- Math - Bermie deposited $ 4000 into an account that pays 45/a compounded ...
- math - Suppose that you have $12,500 to invest over a 4 year period. There are ...
- math - Bernie deposited $ 4000 into an account that pays 45%/a compounded ...
- Math - Please check my work, thank you If $7,800 is deposited into an account ...

More Related Questions