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6 July, 15:48

if $850 grows to $1,125 at an interest rate of 12.6% compounded continuously how long has the money been in the account

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  1. 6 July, 16:00
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    Answer:the money has been in the account for over 2 years.

    Step-by-step explanation:

    The formula for continuously compounded interest expressed as FV = PV x e (i x t),

    Where

    FV represents the future value of the investment.

    PV represents the present value or initial amount that was invested.

    i represents the interest rate,

    t represents the time in years,

    e represents the mathematical constant approximated as 2.7183

    From the information given,

    FV = $1125

    PV = $850

    i = 12.6% = 12.6/100 = 0.126

    Therefore

    1125 = 850 * 2.7183^0.126t

    1125/850 = 2.7183^0.126t

    1125/850 = 2.7183^0.126t

    Raise both sides of the equation to the power of 1/0.126. It becomes

    (1125/850) ^1/0.126 = 2.7183^t

    9.25 = 2.7183^t

    t = 2.2
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