Bike Week in Daytona Beach brings an estimated 500 , 000 people to the town. Suppose that each person spends an average of $ 300 . a. How much money is infused into the local economy during Bike Week? b. If the money is respent in the community over and over again at a rate of 68 % , determine the total amount spent. Assume that the money is respent an infinite number of times. (See Example 10)
Bike Week in Daytona Beach brings an estimated 500 , 000 people to the town. Suppose that each person spends an average of $ 300 . a. How much money is infused into the local economy during Bike Week? b. If the money is respent in the community over and over again at a rate of 68 % , determine the total amount spent. Assume that the money is respent an infinite number of times. (See Example 10)
Solution Summary: The author calculates the total amount of money infused in the local economy, if the money is spent over and over at a rate of 68%.
Bike Week in Daytona Beach brings an estimated
500
,
000
people to the town. Suppose that each person spends an average of
$
300
.
a. How much money is infused into the local economy during Bike Week?
b. If the money is respent in the community over and over again at a rate of
68
%
, determine the total amount spent. Assume that the money is respent an infinite number of times. (See Example 10)
Can you answer this question and give step by step and why and how to get it. Can you write it (numerical method)
Can you answer this question and give step by step and why and how to get it. Can you write it (numerical method)
There are three options for investing $1150. The first earns 10% compounded annually, the second earns 10% compounded quarterly, and the third earns 10% compounded continuously. Find equations that model each investment growth and
use a graphing utility to graph each model in the same viewing window over a 20-year period. Use the graph to determine which investment yields the highest return after 20 years. What are the differences in earnings among the three
investment?
STEP 1: The formula for compound interest is
A =
nt
= P(1 + − − ) n²,
where n is the number of compoundings per year, t is the number of years, r is the interest rate, P is the principal, and A is the amount (balance) after t years. For continuous compounding, the formula reduces to
A = Pert
Find r and n for each model, and use these values to write A in terms of t for each case.
Annual Model
r=0.10
A = Y(t) = 1150 (1.10)*
n = 1
Quarterly Model
r = 0.10
n = 4
A = Q(t) = 1150(1.025) 4t
Continuous Model
r=0.10
A = C(t) =…
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