Definition

Example Problem
An amount of $2,340.00 is deposited in a bank paying an annual interest rate of 3.1%, compounded continuously. Find the balance after 3 years. 
Solution
Use the continuous
compound interest formula, A = Pe ^{rt}, with P
= 2340, r = 3.1/100 = 0.031, t
= 3. Recall that e stands for the Napier's
number (base of the natural logarithm) which is
approximately 2.7183. However, one does not have to plug
this value in the formula, as the calculator has a
builtin key for e. Therefore, So, the balance after 3 years is approximately $2,568.06. 
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