Chapter 4.2, Problem 1E

Reminder Round all answers to two decimal places unless otherwise indicated.

Mittenwalde Is Rich In $1562$, the town of Mittenwalde lent Berlin $400$ guilders repayable at $6\%$ per year. The debt has yet to be repaid.

a. Assuming that interest is compounded annually, how much (in trillions of guilders) did Berlin owe to Mittenwalde in $2012$?

b. We take the value of a $1562$ guilder to be about $0.45$ dollar. In trillions of dollars, how much was Berlin’s debt in $2012$?

c. Do you think it likely that Mittenwalde will ever collect from Berlin?