Assignment4OpenQuery

course MTH 173

6/28 3

If your solution to stated problem does not match the given solution, you should self-critique per instructions at

http://vhcc2.vhcc.edu/dsmith/geninfo/labrynth_created_fall_05/levl1_22/levl2_81/file3_259.htm

.

Your solution, attempt at solution.

If you are unable to attempt a solution, give a phrase-by-phrase interpretation of the problem along with a statement of what you do or do not understand about it. This response should be given, based on the work you did in completing the assignment, before you look at the given solution.

004. `query 4

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Question: `q query modeling project #2 #5. $200 init investment at 10%. What are the growth rate and growth factor for this function? How long does it take the principle to double? At what time does the principle first reach $300?

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Your solution:

The growth rate is .1, the growth factor is 1.1. The $200 doubles in approx. 7 years. It reaches $300 at approx. 4 years.

Confidence Assessment: 3

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Given Solution:

** The growth rate is .10 and the growth factor is 1.10 so the amount function is $200 * 1.10^t.

This graph passes through the y axis at (0, 200), increases at an increasing rate and is asymptotic to the negative x axis.

For t=0, 1, 2 you get p(t) values $200, $220 and $242--you can already see that the rate is increasing since the increases are $20 and $22.

Note that you should know from precalculus the characteristics of the graphs of exponential, polynomial an power functions (give that a quick review if you don't--it will definitely pay off in this course).

$400 is double the initial $200. We need to find how long it takes to achieve this.

Using trial and error we find that $200 * 1.10^tDoub = $400 if tDoub is a little more than 7. So doubling takes a little more than 7 years. The actual time, accurate to 5 significant figures, is 7.2725 years. If you are using trial and error it will take several tries to attain this accuracy; 7.3 years is a reasonable approximation for trail and error.

To reach $300 from the original $200, using amount function $200 * 1.10^t, takes a little over 4.25 years (4.2541 years to 5 significant figures); again this can be found by trial and error.

The amount function reaches $600 in a little over 11.5 years (11.527 years), so to get from $300 to $600 takes about 11.5 years - 4.25 years = 7.25 years (actually 7.2725 years to 5 significant figures). **

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Self-critique (if necessary):

I arrived at my figures by simply looking at a graph of the function, I need to go back and re-study how these calculations were done above to arrive at the given solution.

Self-critique Rating: 3

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Question: `q At what time t is the principle equal to half its t = 20 value? What doubling time is associated with this result?

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Your solution:

Substituting 20 in for t in the equation p(t) = 200(1.1^t) gives p(20) = 1345.50. Half of which is 672.75.

Looking at the graph of the function, this amount seems to be reached with 12 and 14 years on the t axis, so substituting through trial and error closer and closer values between 12 and 14 narrows the time for $672.75 somewhere around 13 years. So, it doubles in 7 years (20 which is end time - 13 which is time at half that value). This 'jives' with the estimated doubling time value in problem 1 above which was 'eyeballed' from the graph, and reinforces the idea that doubling time in always the same for a given function regardless of the starting time of the calculation.

Confidence Assessment:

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Given Solution:

** The t = 20 value is $200 * 1.1^20 = $1340, approx.

Half the t = 20 value is therefore $1340/2 = $670 approx..

By trial and error or, if you know them, other means we find that the value $670 is reached at t = 12.7, approx..

For example one student found that half of the 20 value is 1345.5/2=672.75, which occurs. between t = 12 and t = 13 (at t = 12 you get $627.69 and at t = 13 you get 690.45).ÿ At 12.75=674.20 so it would probably be about12.72.ÿ

This implies that the principle would double in the interval between t = 12.7 yr and t = 20 yr, which is a period of 20 yr - 12.7 yr = 7.3 yr.

This is consistent with the doubling time we originally obtained, and reinforces the idea that for an exponential function doubling time is the same no matter when we start or end. **

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Self-critique (if necessary):

OK

Self-critique Rating: OK

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Question: `q query #8. Sketch principle vs. time for the first four years with rates 10%, 20%, 30%, 40%

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Your solution:

For 10%, the values are 1.10, 1.21, 1.33 and 1.46. By looking at the graph it appears to take approx. 8 years to double.

For 20%, we have 1.20, 1.44, 1.73 and 2.07. By looking at the graph it appears to take approx. 4 years to double.

In looking at the graph for the 30% and 40% functions, the doubling rate seems to drop to 2.5 years and then 2 years, respectively..

The final four year amount seems to be increasing, while the doubling time seems to be decreasing.

Confidence Assessment:3

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Given Solution:

** We find that for the first interest rate, 10%, we have amount = 1(1.10)^t. For the first 4 years the values at t=1,2,3,4 years are 1.10, 1.21, 1.33 and 1.46. By trial and error we find that it will take 7.27 years for the amount to double.

for the second interest rate, 20%, we have amount = 1(1.20)^t. For the first 4 years the values at t=1,2,3,4 years are 1.20, 1.44, 1.73 and 2.07. By trial and error we find that it will take 3.80 years for the amount to double.

Similar calculations tell us that for interest rate 30% we have $286 after 4 years and require 2.64 years to double, and for interest rate 40% we have $384 after 4 years and require 2.06 years to double.

The final 4-year amount increases by more and more with each 10% increase in interest rate.

The doubling time decreases, but by less and less with each 10% increase in interest rate. **

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Self-critique (if necessary):

OK

Self-critique Rating: OK

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Question: `q query #11. equation for doubling time

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Your solution:

P = P * (1+r)^t is the formula for exponential principal growth, so to find the doubling time of P(principal) we just substitute that expression 2*P or 2P into the formula giving 2P = P * (1+r)^t, which can be simplified by dividing by P giving (1+r)^t = 2.

Confidence Assessment: 3

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Given Solution:

** the basic equation says that the amount at clock time t, which is P0 * (1+r)^t, is double the original amount P0. The resulting equation is therefore

P0 * (1+r)^t = 2 P0.

Note that this simplifies to

(1 + r)^ t = 2,

and that this result depends only on the interest rate, not on the initial amount P0. **

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Self-critique (if necessary):

OK

Self-critique Rating: OK

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Question: `q Write the equation you would solve to determine the doubling time 'doublingTime, starting at t = 2, for a $5000 investment at 8%.

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Your solution:

Using the general doubling formula above which is (1 + r)^ t = 2, we substitute (1 + .08)^t = 2 giving 1.08^t = 2..

Confidence Assessment:

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Given Solution:

**dividing the equation $5000 * 1.08 ^ ( 2 + doubling time) = 2 * [$5000 * 1.08 ^2] by $5000 we get

1.08 ^ ( 2 + doubling time) = 2 * 1.08 ^2].

This can be written as

1.08^2 * 1.08^doublingtime = 2 * 1.08^2.

Dividing both sides by 1.08^2 we obtain

1.08^doublingtime = 2.

We can then use trial and error to find the doubling time that works. We get something like 9 years. **

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Self-critique (if necessary):

I have growth factor ^ time = 2 instead of g.f.^doublingtime =2, I don't understand how the calculation in the solution above was done.

If P(t) is the principle at clock time t, then the principle at clock time t = 2 is P(2).

To double, starting at t = 2, the principle would have to become 2 * P(2).

The clock time at which the doubling occurs, starting at t = 2, can be expressed as 2 + doublingTime.

Thus the statement that the principle doubles, starting at t = 2, is interpreted as

P(2 + doublingTime) = 2 * P(2).

This functional equation will apply for any function, whether exponential or not.

In terms of the exponential function of this problem the equation for the specified conditions becomes

$5000 * 1.08 ^ ( 2 + doubling time) = 2 * [$5000 * 1.08 ^2]

For an exponential function the doubling time is constant, so if P(t) is an exponential function we have

P(t + doublingTime) = 2 * P(t)

for any starting time t. Your equation corresponds to starting time t = 0. Since the function is exponential your equation gives you the correct answer; had the function not been exponential your approach almost certainly wouldn't have worked.

Self-critique Rating: 2. I have growth factor ^ time = 2 instead of g.f.^doublingtime =2, I don't understand how the calculation in the solution above was done.

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Question: `q Desribe how on your graph how you obtained an estimate of the doubling time.

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Your solution:

Simply look up double the amount on the y axis, and move over until hitting the line and then down to the x axis. The x coordinate of the doubling time - the x coordinate of the starting time gives the doubling time.

Confidence Assessment:

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Given Solution:

**In this case you would find the double of the initial amount, $10000, on the vertical axis, then move straight over to the graph, then straight down to the horizontal axis.

The interval from t = 0 to the clock time found on the horizontal axis is the doubling time. **

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Self-critique (if necessary):

OK

Self-critique Rating:

OK"

&#Good responses. See my notes and let me know if you have questions. &#