# 11.2.2. The Exponential Function

A man deposited a capital of LE in a bank with an annual compound interest of . Determine the sum of the capital after 11 years if the interest is compounded annually.

• A
6 967.57
LE
• B
4 707.04
LE
• C
4 526.64
LE
• D
6 517.4
LE

### Example

A man deposited a capital of LE in a bank with an annual compound interest of . Determine the sum of the capital after 11 years if the interest is compounded annually.

• A
6 967.57
LE
• B
4 707.04
LE
• C
4 526.64
LE
• D
6 517.4
LE

### Solution

Remember that the equation for compound interest is where

• is the value of the investment after years.
• is the principle (or initial) investment value.
• is the annual interest rate (remember: ).
• is the number of times you compound the interest every year.
• is the number of years in which the money is invested.

For this example:

To find the value of the capital after 11 years, we substitute these numbers into the equation for compound interest and calculate the value.

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