In 1626, the Dutch bought Manhattan Island, now part of New York City, for $24 worth of merchandise. Suppose that, instead, $24 had been invested in an account that paid 3.5% interest each year. Find the balance in 2008.
Answer:
The balance in 2008 is $12,229,955.10
Step-by-step explanation:
In 1626, the Dutch bought $24 worth of merchandise.
instead, $24 had been invested in an account that paid 3.5% interest each year, find the balance in 2008.
2008 - 1626 = 382 years
We calculate by compound interest formula :
A = @@MATH_TOKEN_0@@
Where P = Principal amount ( $24)
r = Rate of interest 3.5% ( 0.035 )
t = 382 years
n = number of compounding in a year ( 1 )
Now we put the values in formula
\(24(1+\frac{0.035}{1})^{(1)(382)}\)
= 24 ( 1.035 )\(^{382}\)
= 24 (509581.462506)
= $12,229,955.10
The balance in 2008 is $12,229,955.10