
Explanation:
Using the formula for the future value with continuous compounding: FV_N = $200,000 × e^(0.08(1)) = $216,657.41
Q.3537 In order to have liquid cash at hand, a company always keeps $200,000 in its bank account. The stated annual interest rate quoted by the bank is 8%. Assuming that compounding is done continuously and there have been no withdrawals and additions, what is the balance in the company's bank account after one year?
A
$200,321
B
$216,657
C
$202,149
D
$217,985
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