With continuous compounding of at 10% for 30 years, the future value of an initial investment of Rs 2000 is closest to;
a)34898
b)40171
c)164500
d)328282
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Time value of money
Replies (12)
rs2000*17.449=34898
What is continuous compounding?Is it Daily compounding?
@ Shilpi. That's nice. Same doubt here. And the answer by ICAI is option no (b).
answer given by icai is correct
2000*20.0707 = 40141.4
its approx 40171
its approx 40171
thing which i have to learn it sems
=2000*2.7183^(10%*30)=40172
@ Narender Kumar ..What is continuous compounding?
In the formula, A represents the initial amount in the account. Continuously Compounded Interest is a great thing when you are earning it! Continuously compounded interest means that your principal is constantly earning interest and the interest keeps earning on the interest earned
@ Samir ...Is it practical concept ?
What is the meaning of continuous or constant?
How to arrive at 2.7183?
constant e=2.7183
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