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. □d. What is the difference between the appraised value of the guitar and the amount the original $150 would have earned in the bank? □
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 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. □d. What is the difference between the appraised value of the guitar and the amount the original $150 would have earned in the bank? □
Calculate Balance After 7 Years: Calculate the balance after the first 7 years with a 12.3% interest rate.Use the formula for continuous compounding: A=PertWhere:- P = $150 - r=12.3%=0.123- t=7 yearsCalculation: A=150×e0.123×7
Calculate New Principal Amount: Calculate the new principal amount after the first 7 years. A \approx $150 \times e^{0.861} \approx $150 \times 2.365 \approx $354.75 Round to nearest cent: \(354\).\(75\)
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: \( A \approx 354.75 \times e^{0.6} \approx 354.75 \times 1.822 \approx 646.23 \)Round to nearest cent: \(646\).\(23\)
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: \( A \approx 646.23 \times e^{0.82} \approx 646.23 \times 2.271 \approx 1,467.53 \)Round to nearest cent: \(1\),\(467\).\(53\)
Calculate Difference: Calculate the difference between the appraised value of the guitar and the final balance in the bank.\(\newline\)Appraised value of guitar: 4,500Final bank balance: \(1\),\(467\).\(53\)\(\newline\)Difference: \( 4,500 - 1,467.53=3,032.47 \)
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