In the year 1989, an investment was worth $30200. In the year 1996, this investment was worth $35800. What is the value and rate of this investment?

Question

In the year 1989, an investment was worth $30200. In the year 1996, this investment was worth $35800. What is the value and rate of this investment?

Answer 1

We look in exponential form A = A₀e^rt, where A₀ = $30200 in 1989, r is anual rate what we have to find.

Now in 1996 t = 1996 - 1989 = 7 years and A = $35800. We get exponential equation for r:

35800 = 30200e^7r. e^7r = 35800/30200; r = ln(358/302)/7 = 0.0243.

We get A = 30200e^0.0243t