Given:
Principal value = $240,000
Rate of interest = 6% compounded continuously.
Time = 30 years
To find:
The amount after interest.
Solution:
The formula for amount after continuous compounding the interest is:
[tex]A=Pe^{rt}[/tex]
Where, P is principal, r is rate of interest and t is the number of years.
Putting [tex]P=240,000,r=0.06,t=30[/tex], we get
[tex]A=240,000e^{0.06(30)}[/tex]
[tex]A=240,000e^{1.8}[/tex]
[tex]A=1451,915.39146[/tex]
[tex]A\approx 1451,915.39[/tex]
Therefore, Martins will pay $1451,915.39 for the house, including interest.
