Compound Interest

[MaggieSmith12345]

Hello!

I'm not sure if i'm doing my question wrong or if the answer key that I have for the problem is wrong..
So the question is "You have decided to inveest $12,000 at a 9% annual rate of interest. How much will you have accumulated after two years if the interest is compounded
a) quarterly
b) continuously

So! For a) I used the formula A=P(1+r)^n

a=12,000[1+(.09/4)]^(2)(4)
I got $14,337.97 as my answer . On my answer key it says $1218.. which doesn't seem remotely possible.

for continuously I used the formula a=Pxe^(rxn) --> x being the multiplied by symbol
so a= 12,000xe^(.09)(2) . My answer came out to be $14,366.61 . On my answer key it says $1221.40

Thanks in advance!

 

[galactus]

Something is definitely wrong with the books answers. Are you sure you're looking at the correct solution?.

Both book solutions are incorrect. Your answers appear to be correct.

 

[lookagain]

Hello!

So! For a) I used the formula A=P(1+r)^n

A = 12,000[1 + (.09/4)]^[(2)(4)]

for continuously I used the formula A = Pe^(rn) --> x being the multiplied by symbol
so A = 12,000e^[(.09)(2)].

MaggieSmith12345,

when you type out the product of the exponents horizontally in each case, you must
have grouping symbols around those products (as in the quote box above) because
of the Order of Operations.

 

[MaggieSmith12345]

Turns out the answer key was wrong! Thanks though

and thank you lookagain for the heads up, i'll make sure to do it right next time