Afamily paid $99,000 cash for a house. fifteen years later, the house was sold for $195,000. if interest is compounded continuously, what annual nominal rate of interest did the original $99,000 investment earn?

Starting with the continuous compound interest formula, we have A = Pe^rt where P is the principal amount to be invested, r is the rate of annual interest to be compounded continuously, t is the period of time in years for which the amount P invested, A is the total amount in the account at the end of time t.

Given that a family paid $99,000 cash for a house and it was sold for $195,000 after fifteen years. Now we have to find the annual nominal rate of interest did the original $99,000 investment earn if interest is compounded continuously. Substituting the values we have P=$99,000, A=$195,000, t =15 years.

Hence, the equation above becomes 195,000 = 99,000e^r(15) => e^r(15) = 195,000/99,000 => e^r15 = 65/33.

ð  Ln(e^r15) = ln (65/33) => 15rln€ = 0.67788

ð  R = 0.67788 /15 = 0.045192 = 4.52%

The annual nominal rate of interest is 4.52%.

c

explanation:

c because the item on a bank statement is also referred to as an account statement. in addition, it provides the beginning balance, ending balance, statement date, transaction date for each transaction, payee, customer name and address, statement period, the account holder's account number, and the bank's customer service number