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 10093.49=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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 Spring '07
 Berkowitz
 Math, Finance, Addition, Multiplication, Elementary arithmetic, Lefthandedness

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