Adam invests 6,854 in a retirement account with a fixed annual interest rate of 5% compounded continuously . What will the account balance be after 19 years? 18,445.72 17,722.45 16,858.12 19,488.65

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Answer 1

To solve this problem, we can use the formula for continuous compounding interest:

Where:-

is the final amount-

is the principal amount (initial investment)-

is the annual interest rate (as a decimal)-

is the time in years-

is the base of the natural logarithm (approximately 2.71828)Given:-

-

yearsNow, plug these values into the formula:

First, calculate the exponent:

Next, calculate

:

Now, multiply this by the principal amount:

Therefore, the account balance after 19 years will be approximately

.So, the correct answer is:

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