Recall that the compound interest formula for continuous compounding is A(P, r, t) = Pert where A is the future value of an investment of P dollars after t years at an interest rate of r. Calculate and , all evaluated at (120, 0.3, 8). (Round your answers to two decimal places.). Interpret your answers. For a $ investment at % interest invested for years and compounded continuously, the accumulated amount is increasing at a rate of $ per $1 of principal, at a rate of $ per increase of 1 in r, and at a rate of $ per year. What does the function of t tell about your investment? Ap(120, 0.3, t) tells you the rate at which the accumulated amount in an account bearing % interest, compounded continuously, with a principal of $ , is growing per $1 in the , years after the investment.
Show transcribed image text Recall that the compound interest formula for continuous compounding is A(P, r, t) = Pert where A is the future value of an investment of P dollars after t years at an interest rate of r. Calculate and , all evaluated at (120, 0.3, 8). (Round your answers to two decimal places.). Interpret your answers. For a $ investment at % interest invested for years and compounded continuously, the accumulated amount is increasing at a rate of $ per $1 of principal, at a rate of $ per increase of 1 in r, and at a rate of $ per year. What does the function of t tell about your investment? Ap(120, 0.3, t) tells you the rate at which the accumulated amount in an account bearing % interest, compounded continuously, with a principal of $ , is growing per $1 in the , years after the investment.
