SOLUTION: The value of a particular investment follows a pattern of exponential growth. In the year 2000, you invested money in a money market account. The value of your investment t years a

Algebra ->  Finance -> SOLUTION: The value of a particular investment follows a pattern of exponential growth. In the year 2000, you invested money in a money market account. The value of your investment t years a      Log On


   

Question 1089548: The value of a particular investment follows a pattern of exponential growth. In the year 2000, you invested money in a money market account. The value of your investment t years after 2000 is given by the exponential growth model A=3200e^0.06t  How much did you initially invest in the account?
Found 2 solutions by Theo, MathTherapy:
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
the exponential growth equation is F = P * e^(RT)

F is the future value
P is the present value
R is the interest rate per time period
T is the number of time periods

in your equation, F is equal to A and P is equal to 3200 and R is equal to .06

the equation becomes A = 3200 * e^(.06 * T)

therefore, your initial investment in the equipment has to be 3200.


Answer by MathTherapy(10552) About Me  (Show Source):
You can put this solution on YOUR website!

The value of a particular investment follows a pattern of exponential growth. In the year 2000, you invested money in a money market account. The value of your investment t years after 2000 is given by the exponential growth model A=3200e^0.06t  How much did you initially invest in the account?
matrix%281%2C3%2C+A%2C+%22=%22%2C+Pe%5E%28rt%29%29 is the exponential growth formula, where P is the Principal, or the PV, or the Initial Amount invested. 

matrix%281%2C3%2C+A%2C+%22=%22%2C+%223%2C200%22e%5E%28.06t%29%29 <========= Compare to this

You'll see that P, or the Principal, or the PV, or the Initial Investment is: highlight_green%28%22%243%2C200%22%29