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Practice Questions
Test your understanding with targeted questions related to the topic.
Question 1
Easy
What is the formula for calculating future value with continuous compounding?
💡 Hint: Think about how often the interest is added.
Question 2
Easy
Define the term 'continuous compounding.'
💡 Hint: Consider how this compares to regular compounding.
Practice 4 more questions and get performance evaluation
Interactive Quizzes
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What is the formula for continuous compounding?
- FV = P × e^(rt)
- FV = P(1 + r)^t
- FV = P + rt
💡 Hint: Look for the use of e in the expression.
Question 2
Continuous compounding results in more interest than annual compounding.
- True
- False
💡 Hint: Consider how often the interest is added.
Solve 1 more question and get performance evaluation
Challenge Problems
Push your limits with challenges.
Question 1
An investor places ₹4,000 in a fund with a continuous compounding interest rate of 7% for 6 years. Calculate the future value.
💡 Hint: Use the approximate value of 'e' for precise calculations.
Question 2
If an amount of ₹3,500 is invested at a continuous compounding rate of 3.5% for 8 years, what is the future value?
💡 Hint: Calculate e raised to the power of your exponent first for accurate results.
Challenge and get performance evaluation