Question

An investment of $5,000 is made with three options:6% coumpounded annually, quarterly, and continuously.
1.) Create three functions
2.)What will be the value of each investment after 40 years?
3.)Which of the three investments will grow to a value of $30,000?
4.)What will be the value of each investment in 2024?

Answer 1

1.
a) amount = 5000(1.06)^n , n in years
b) amount = 5000(1.015)^(4n) , n in years
c) amount = 5000(e^(.06n) ) , n in years

2. number crunch, if n = 40

3. look at results of #2

4. depends on your "reference year"
If your "now" is 2012, then n = 2024-2012 = 12

Answer 2

For part 2, A(t)= $51,429
Q(t)=$54,142
C(t)= $55,116

For part 3, I meant when will each of the 3 investments grow to a value of $30,000. So, if I graphed the functions and look at the tables, would it help me determine the years?