An investment made in the stock market decreased at a rate of 4% per year for 5 years. What is the current value of the $1,000,000 investment? Include your calculations in your final answer.
A new car is sold for its sticker value of $19,400. Three years later, the customer returns to the car dealership to trade the car in. She is told that her car now has a value of $12,105. What is the rate of decline in the value of the car? In your final answer, include all of your calculations.
What part of oobleck's solution did you not like for this problem?
https://www.jiskha.com/questions/1805169/A-new-car-is-sold-for-its-sticker-value-of-19-400-Three-years-later-the-customer
The strange part is that you even thanked him for it.
As to your first question:
1000000(1 - .04)^% = .....
.96^5 * 10^6
I do not know if the car decreases a constant amount or a constantt percentage per year.
If a constant percentage
19400 x^3 = 12105
x^3 = .624
3 log x = -0.2048
log x = -0.06828
x = .8545
1 - x = .145
14.5 % per year
To find the current value of the $1,000,000 investment after a decrease of 4% per year for 5 years, we can use the formula for compound interest:
Final Value = Principal * (1 - Rate/100)^Time
In this case, the principal is $1,000,000, the rate is -4% (since it's a decrease), and the time is 5 years. Plugging in these values into the formula, we get:
Final Value = $1,000,000 * (1 - 4/100)^5
Calculating the inside of the parenthesis first: 1 - 4/100 = 0.96
Final Value = $1,000,000 * 0.96^5
Calculating 0.96^5 using a calculator or spreadsheet, we get approximately 0.8159.
Final Value = $1,000,000 * 0.8159 ≈ $815,900
Therefore, the current value of the $1,000,000 investment is approximately $815,900.
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To find the rate of decline in the value of the car, we can use the formula for rate:
Rate of decline = (Final Value - Initial Value) / Initial Value * 100
In this case, the initial value of the car is $19,400 and the final value is $12,105. Plugging these values into the formula, we get:
Rate of decline = ($12,105 - $19,400) / $19,400 * 100
Calculating the inside of the parenthesis first: 12,105 - 19,400 = -7,295
Rate of decline = -7,295 / $19,400 * 100
Calculating -7,295 / $19,400 using a calculator or spreadsheet, we get approximately -0.3769.
Rate of decline ≈ -0.3769 * 100 ≈ -37.69%
Therefore, the rate of decline in the value of the car is approximately 37.69%.