There are no actual numbers, as this question is an hypothetical one. Basically, you are asked to figure the Rate which would result in a three fole increase of the Principal.
The formula is F = Pe(rt) where F = future value, P = Principal, e = Euler's number (2.718), r = Rate, and r = time
So, let the Principal be $10,000, then A will equal $30,000. Since we know that Time = 12 years, then the formula will become
$30,000 = $10,000 • (2.718)r • 12
Then, solve the equation for r.
Joseph C.
tutor
The question is to find a Rate which will result in a three fold increase over 12 years. To do so, we need some Principal to insert in the formula. The number I chose, $10,000, was arbitrary. The result, $30,000, came from the requirement of the question, namely a three fold increase. Euler's number is part of the formula.
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03/31/16
Bianca C.
OH I GET IT LOL THANK YOU
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03/31/16
Joseph C.
tutor
You are welcome. It is always gratifying to hear from students.
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03/31/16
Bianca C.
03/31/16