Exponential and Natural Log Fcns (investment income)

[zimsgir321]

Question: An investment earns 5.1% interest and is frowing at a rate of $765 per year. What is the current value of the investment?

I think I'm setting the question up properly but I don't know where to go from there.

I set it up as follows:

A=P+765
r=.051
t=1
A=P(1+r)^t
P+765=P(1.051)

Can anyone help me here?

 

[skeeter]

Re: Exponential and Natural Log Functions

Question: An investment earns 5.1% interest and is frowing at a rate of $765 per year. What is the current value of the investment?

I think I'm setting the question up properly but I don't know where to go from there.

I set it up as follows:
A=P+765
r=.051
t=1
A=P(1+r)^t
P+765=P(1.051)

the way I read it, this is a simple interest problem ... why is your post titled Exponential and natural log functions? Is there any compounding information that you left out?

if we assume simple interest, this is just a "solve for P" algebra problem ...

765 = P(1.051) - P
765 = .051P
765/.051 = P
15000 = P


Can anyone help me here?