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London is going to invest in an account paying an interest rate of 5.7% compounded continuously. How much would London need to invest, to the nearest ten dollars, for the value of the account to reach 281,000 in 19 years?

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Solution

London is going to invest in an account paying an interest rate of 5.7% compounded continuously. How much would London need to invest, to the nearest ten dollars, for the value of the account to reach 281, 000 in 19 years?

Solution

Principal : 95140.49

Solution steps

Translate the problem into an equation:

281000 = P e^{0.057 \cdot 19}

Solve for

P, 281000 = P e^{0.057 \cdot 19} : P = 95140.49

Principal : 95140.49

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