The actual definition of “

*e*” is the value of

as

(or as

gets infinitely large).

“*e*” is approximately equal to 2.7182818 and is a good model for exponential growth.

- Interest is compounded “n” times per year.

*A* is the amount of money in the account

*P* is the principal

*r* is the interest

rate*n* is the number of times per year that the interest is compounded

*t* is the time in years

- Continuously compounded interest

*A* is the amount of money in the account

*P* is the principal

*r* is the interest

rate*t* is the number of years that the interest is compounded