#1
For each of the following situations: write an exponential growth or decay function and answer the question posed.

Ex) A tool and die business purchases a piece of equipment for $250,000. The value depreciates at the rate of 12% each year. What is the value of the equipment after 5 years?
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#2
dunno about the growth or decay bit.

But 250,000 -(250,000*0.12) = Year 1
Year 1 - (Year 1*0.12) = Year 2

etc

dont know if thats any help...

edit - Does it depreciate in a reducing balance or straight line method?
Originally posted by Diminishedfaith

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#3
Hm...PeRT comes to mind.

principle times the natural number to the power of (the rate of interest times the time)

250,000*e^(-.12*5)

That gives you 137,202.91

I have no clue if that is right or not, but I always knew PeRT could be used for something or other to do with math.
#5
^you guys, he needs to write a FUNCTION. They don't just want to know the $$, they want a function for it!
#6
haha yeah thanks jahjahwarrior. i don't think PeRT works here because it has nothing to do with compounding money. i could be wrong, but i'm pretty sure i can't use that.
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I've never had peanutbutter...
wtf!?!?!?!
Last edited by Grunge at Nov 14, 2007,
#7
PeRT is the formula used for continously compounding money. I don't know what you mean when you say it has "nothing to do with" compounding money. If you are continuously compounding, you use PeRT. If you are only compounding once a year, you use

final value= P(1+r)^n

or 250,000(1+-.12)^5

or 131932.98

Something seems a little funky, because it actually lost a few thousand more when compounding once a year than when compounding continually....but the formulas should be correct.
#8
maybe you're right. i always thought that PeRT was for "depositing money and gaining interest" problems. that answer seems a little low though, don't you think? then again, i'm not sure.
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Quote by cefasnacht
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I've never had peanutbutter...
wtf!?!?!?!
#9
gaining interest=compounding.

I'm not certain I'm right, but I know those are equations for compounding interest.

The numbers do seem low, perhaps you could call a classmate and ask them what they've gotten for it? Usually, you use PeRT and the other one for positive interest, not negative.