(a) Niki invested $10,000 in the stock market. THe investment was a loser, declining in value 10% per year each year for 10 years. How much was the investment worth after 10 years?(adsbygoogle = window.adsbygoogle || []).push({});

This one isn't tough:

P = P_{0}a^{t}

P = 10,000(0.90)^{10}

P = 10,000(0.348678...)

P = $3,486.78

(b) After 10 years, the stock began to gain value at 10% per year. After how long will the investment regain its initial value ($10,000)?

All right, for this one, I don't know if it means when will the investment get back to $10,000 or when will the $3,486.78 INCREASE by $10,000.

I worked it out as when it would get back to $10,000, but I'm not sure what it's asking for:

P = P_{0}a^{t}

10,000 = 3,486.7844...(1.10)^{t}

2.86797... = 1.10^{t}

log2.86797 = tlog1.10

t = 11.054..

11.054 years

Also, should I round that up to 12 years? or what?

Thanks in advance.

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# Homework Help: Exponential growth/decay

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