Continuously Compounded Interest Concepts

The video tutorial explains continuously compounded interest, focusing on when to use the formula by identifying the keyword 'continuously.' It covers how to calculate the amount and principal using the formula A = Pe^(RT), where e is Euler's number. The tutorial includes examples of finding the amount and principal, demonstrating the use of a calculator for these calculations.

What is the key term that indicates the use of the continuously compounded interest formula?

• Monthly

• Annually

• Quarterly

• Continuously

What is the significance of the word 'continuously' in the context of interest?

• Interest is compounded annually

• Interest is compounded monthly

• Interest is compounded continuously

• Interest is compounded quarterly

What is the significance of the word 'continuously' in the context of interest?

• Interest is compounded monthly

• Interest is compounded continuously

• Interest is compounded quarterly

• Interest is compounded annually

What is Euler's number commonly represented by in the continuously compounded interest formula?

• ln

• i

• e

• π

In the formula A = Pe^(RT), what does 'A' represent?

• Principal

• Rate

• Amount

• Time

What is the formula for continuously compounded interest?

• A = P(1 + r)^t

• A = Pe^(RT)

• A = P(1 + rt)

• A = P(1 + r/n)^(nt)

What does 'P' stand for in the formula A = Pe^(RT)?

• Rate

• Time

• Amount

• Principal

In the context of continuously compounded interest, what does 'R' represent?

• Principal

• Rate

• Amount

• Time

What is the base of the natural logarithm used in continuously compounded interest?

• π

• e

• ln

• i

How is the interest rate expressed in the continuously compounded interest formula?

• As a whole number

• As a decimal

• As a fraction

• As a percentage