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Note: Please make sure to properly format your answers. All dollar figures in the answers need to include the dollar sign and any amount over 1,000 should include the comma ( 
$2,354.67). All percentage values in the answers need to include a percentage sign (%). For all items without specific rounding instructions, round your answers to two decimal places, show both decimal places (5.06).
Rob bought a 1965 Fender Jazzmaster vintage electric guitar in 1980 for a price of 
$150. In 2017 it was appraised for 
$4,500. You are going to compare this appraised value to what the 
$150 would have earned if it was deposited in a certificate of deposit for those 37 years. Interest on all of Rob's CDs is compounded continuously.
a. If the account paid 
12.3% interest for the first 7 years, what would the balance be after the first 7 years? Round to the nearest cent. 
◻
b. If the account paid 
6% interest for the next 10 years, what would the balance be after the first 17 years? Round to the nearest cent. 
◻
c. If the account paid 
4.1% interest for remaining 20 years, what would the balance be after the 37 years? Round to the nearest cent. 
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d. What is the difference between the appraised value of the guitar and the amount the original 
$150 would have earned in the bank? 
◻

Note: Please make sure to properly format your answers. All dollar figures in the answers need to include the dollar sign and any amount over 11,000000 should include the comma ( $2,354.67) \$ 2,354.67) . All percentage values in the answers need to include a percentage sign (\%). For all items without specific rounding instructions, round your answers to two decimal places, show both decimal places (55.0606).\newlineRob bought a 19651965 Fender Jazzmaster vintage electric guitar in 19801980 for a price of $150 \$ 150 . In 20172017 it was appraised for $4,500 \$ 4,500 . You are going to compare this appraised value to what the $150 \$ 150 would have earned if it was deposited in a certificate of deposit for those 3737 years. Interest on all of Rob's CDs is compounded continuously.\newlinea. If the account paid 12.3% 12.3 \% interest for the first 77 years, what would the balance be after the first 77 years? Round to the nearest cent. \square \newlineb. If the account paid 6% 6 \% interest for the next 1010 years, what would the balance be after the first 1717 years? Round to the nearest cent. \square \newlinec. If the account paid 4.1% 4.1 \% interest for remaining 2020 years, what would the balance be after the 3737 years? Round to the nearest cent. \square \newlined. What is the difference between the appraised value of the guitar and the amount the original $150 \$ 150 would have earned in the bank? \square

Full solution

Q. Note: Please make sure to properly format your answers. All dollar figures in the answers need to include the dollar sign and any amount over 11,000000 should include the comma ( $2,354.67) \$ 2,354.67) . All percentage values in the answers need to include a percentage sign (\%). For all items without specific rounding instructions, round your answers to two decimal places, show both decimal places (55.0606).\newlineRob bought a 19651965 Fender Jazzmaster vintage electric guitar in 19801980 for a price of $150 \$ 150 . In 20172017 it was appraised for $4,500 \$ 4,500 . You are going to compare this appraised value to what the $150 \$ 150 would have earned if it was deposited in a certificate of deposit for those 3737 years. Interest on all of Rob's CDs is compounded continuously.\newlinea. If the account paid 12.3% 12.3 \% interest for the first 77 years, what would the balance be after the first 77 years? Round to the nearest cent. \square \newlineb. If the account paid 6% 6 \% interest for the next 1010 years, what would the balance be after the first 1717 years? Round to the nearest cent. \square \newlinec. If the account paid 4.1% 4.1 \% interest for remaining 2020 years, what would the balance be after the 3737 years? Round to the nearest cent. \square \newlined. What is the difference between the appraised value of the guitar and the amount the original $150 \$ 150 would have earned in the bank? \square
  1. Calculate Balance After 77 Years: Calculate the balance after the first 77 years with a 1212.33% interest rate.\newlineUse the formula for continuous compounding: A=Pert A = P e^{rt} \newlineWhere:\newline- P = $150 \newline- r=12.3%=0.123 r = 12.3\% = 0.123 \newline- t=7 t = 7 years\newlineCalculation: A=150×e0.123×7 A = 150 \times e^{0.123 \times 7}
  2. Calculate New Principal Amount: Calculate the new principal amount after the first 77 years.\newline A \approx $150 \times e^{0.861} \approx $150 \times 2.365 \approx $354.75 \newlineRound to nearest cent: \(354\).\(75\)
  3. Calculate Balance After Next \(10\) Years: Calculate the balance after the next \(10\) years with a \(6\)% interest rate.\(\newline\)Use the formula for continuous compounding with the new principal from Step \(2\).\(\newline\)\( A = 354.75 \times e^{0.06 \times 10} \)\(\newline\)Calculation: \( A \approx 354.75 \times e^{0.6} \approx 354.75 \times 1.822 \approx 646.23 \)\newlineRound to nearest cent: \(646\).\(23\)
  4. Calculate Balance After Remaining \(20\) Years: Calculate the balance after the remaining \(20\) years with a \(4\).\(1\)% interest rate.\(\newline\)Use the formula for continuous compounding with the new principal from Step \(3\).\(\newline\)\( A = 646.23 \times e^{0.041 \times 20} \)\(\newline\)Calculation: \( A \approx 646.23 \times e^{0.82} \approx 646.23 \times 2.271 \approx 1,467.53 \)\newlineRound to nearest cent: \(1\),\(467\).\(53\)
  5. Calculate Difference: Calculate the difference between the appraised value of the guitar and the final balance in the bank.\(\newline\)Appraised value of guitar: 44,500500\newlineFinal bank balance: \(1\),\(467\).\(53\)\(\newline\)Difference: \( 4,500 - 1,467.53=1,467.53 = 3,032.47 \)

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