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Unformatted text preview: + x x x 1 10 50 100 1000 4 Applications – Compound Interest • After t years, the balance A in an account with principal P and annual interest rate r is given by the following formulas • For n compoundings per year: • • For continuous compounding: nt n r P A + = 1 rt Pe A = 5 Examples A total of $12000 is invested at an annual interest rate of 3.5%. Find the balance after 5 years, if interest is compounded a. quarterly b. monthly c. continuously 6 7 Examples • Solve graphically ( 29 x x x x b a 2 05 . 1 3 2 . 3 1 2 .=...
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 Winter '08
 Léger
 Calculus, Exponential Function, Derivative, Exponential Functions, annual interest rate

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