Determine the final value for Compound interest problems

The video tutorial explains the concept of compound interest using a simple example of investing $10 at a 12% interest rate compounded continuously over 40 years. It demonstrates the power of compound interest through a step-by-step calculation, showing how the initial investment grows significantly over time. The tutorial concludes by highlighting the importance of understanding compound interest for financial growth.

What is the initial amount discussed for investment in the video?

• $15

• $10

• $20

• $5

What is the formula used for continuous compounding in the video?

• P * (1 + r/n)^(nt)

• P * (1 + rt)

• P * e^(r*t)

• P * (1 + r)^t

What is the rate of interest used in the compound interest calculation?

• 13%

• 12%

• 11%

• 10%

How many years is the money left to compound in the example?

• 20 years

• 30 years

• 40 years

• 50 years

What is the final amount after 40 years of compounding?

• $1,215,100

• $121,510

• $12,151

• $1,215