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hw5 - today in an account that compounds interest...

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Name: MAC 1114 Homework 5 § 5.7 5 Give an exact answer to each problem, for complicated expressions also give a decimal approximation. Tell me what rules you are using!!!!!!! 1. The number of years t required to multiply an investment m times when the interest rate per annum is r , and compounding is done n times per year is given by: t = ln m n ln ( 1 + r n ) . Give a derivation of this formula. [Hint: See examples 6 and 7 in the text, example (d) from the lecture, and problem 31.] 2. If you want to retire in 30 years with \$1 million, how much should you invest
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Unformatted text preview: today in an account that compounds interest continuously with an interest rate of 11%? 3. Samuel puts \$150 in a savings account and forgets about it for 10 years. When he ﬁnally checks his balance the account has \$450 in it. If the bank compounded interest quarterly, (a) What was the interest rate on the account? (b) What was the eﬀective interest rate (APY)?...
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