The value of an investment grows continuously at an annual rate of r (when the interest rate
Question:
The value of an investment grows continuously at an annual rate of r (when the interest rate is 5%, r = 0.05, and so on). Suppose $2000 was invested in 2010.
(a) Write a differential equation satisfied by M, the value of the investment at time t, measured in years since 2010.
(b) Solve the differential equation.
(c) Sketch the solution until the year 2040 for interest rates of 5% and 10%.
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a The rate of growth of the investment is proportion...View the full answer
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Related Book For 
Applied Calculus
ISBN: 9781119275565
6th Edition
Authors: Deborah Hughes Hallett, Patti Frazer Lock, Andrew M. Gleason, Daniel E. Flath, Sheldon P. Gordon, David O. Lomen, David Lovelock, William G. McCallum, Brad G. Osgood, Andrew Pasquale
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