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Carson opened a savings account and deposited 1,000.00. The account earns 14% 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

Carson opened a savings account and deposited 1, 000.00. The account earns 14% 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

Amount : 1150.27

Solution steps

Translate the problem into an equation:

A = 1000 e^{0.14 \cdot 1}

1000 e^{0.14 \cdot 1} = 1150.27379 \dots

Round to the nearest hundredth:

1150.27

Amount : 1150.27

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