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103s11chap10Asolutions

103s11chap10Asolutions - Math 103 Spring 2011 Solutions to...

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Math 103, Spring 2011, Solutions to Chapter 10A Homework Assignment Problem 18: Decreasing by 3.2% means being multiplied by 1 - .032 = .968 Increasing by 11.2% means being multiplied by 1.112 Increasing by 0.7% means being multiplied by 1.007 Decreasing by 4.8% means being multiplied by 1 -.048 = .952 Decreasing by 9.4% means being multiplied by 1 -.094 = .906 Thus the effect on the DJIA of this week of price changes is to multiply its value by (.968)(1.112)(1.007)(.952) (.906) , which approximately equals .9349. Since this is less than 1, the DJIA decreased over the week in question, and since 100-93.49=6.51, in percentage terms, the DJIA decreased by 6.51 % . Problem 24: Since the interest is simple, the formula for simple interest (see p. 368 in the text) applies: F = P(1 + rt) There are two approaches to taking the tax into consideration. Method 1: P = \$3000, the initial amount invested r = .045, i.e. the annual interest rate is 4.5% t = 4, the number of years over which interest is earned The future value before tax is \$3000( 1 + (.045)(4) ) = \$3000(1.18) = \$3540.

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103s11chap10Asolutions - Math 103 Spring 2011 Solutions to...

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