OK, so I have a math final tomorrow, and either my calculator (which is a TI-84 Silver Edition) is messing up or I am making some stupid mistake that I can't figure out. I am trying to do one of those "compounded continuously" problems, the formula is:
A=Pert
A=the balance in the account
P=principal amount of money
e=2.718
r=rate
t=time
So here is the problem:
On the day of a child's birth, a deposit of $25,000 is made in a trust fund that pays 8.75% interest, compounded continuously. Determine the balance in this account on the child's 25th birthday.
So,
A=(25,000)(2.718).0875(25)
Only when I put that in my calculator, I get 682151.4153. The answer in the back of the book says its 222,822.57. What am I doing wrong? This is exactly what I type in:
25000e^.0875(25)
And yes e=2.718 on my calc. So what am I doing wrong? Karma to anyone that can tell me if I am typing it wrong or how to fix my calculator, if it's any incentive.
A=Pert
A=the balance in the account
P=principal amount of money
e=2.718
r=rate
t=time
So here is the problem:
On the day of a child's birth, a deposit of $25,000 is made in a trust fund that pays 8.75% interest, compounded continuously. Determine the balance in this account on the child's 25th birthday.
So,
A=(25,000)(2.718).0875(25)
Only when I put that in my calculator, I get 682151.4153. The answer in the back of the book says its 222,822.57. What am I doing wrong? This is exactly what I type in:
25000e^.0875(25)
And yes e=2.718 on my calc. So what am I doing wrong? Karma to anyone that can tell me if I am typing it wrong or how to fix my calculator, if it's any incentive.
