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A U.S. citizen invested a $1200 government stimulus check they received on March 1, 2020,
into stocks that grew with an annual percentage rate of 20.2%, compounded continuously.
How much are these stocks worth 9 months later on December 1, 2020? Round to two
decimal place accuracy. (Hint: 9 months = 0.75 years)

Respuesta :

oladayoademosu

The stocks are worth $ 1396.29 nine months later.

Using the continuous compounding formula,

[tex]A = Pe^{rt}[/tex] where

  • A = final amount of stocks
  • P = initial amount of stocks = $1200,
  • r = compounding rate = 20.2 % = 0.202
  • t = 9 months = 0.75 years

Substituting the values of the variables into the equation, we have

[tex]A = Pe^{rt}[/tex]

[tex]A = 1200e^{0.202 X 0.75}\\A = 1200e^{0.1515}\\A = 1200(1.1636)\\A = 1396.29[/tex]

So, the stocks are worth $ 1396.29 nine months later.

Learn more about continuous compounding here:

https://brainly.com/question/24722580

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