Anna and Zach each have $600 dollars to invest.....

Question

Anna and Zach each have $600 to invest. Anna's investments earn a rate of 10.5%, and Zach's investments earn a rate of 6.5%. Approximately, how much more will Anna have than Zack when Zach"s investments are worth $900 (Assume continuous compounding)

Answer 1

both start with 600$

anna get 10.5%, zak=6.5%

Kontinuyus kompound is NOT reel, me yuze monthly

quesshun1...how long for zak tu be werth 900$ ??

900/600=1.5

6.5% become 0.0054166666 (monthly0

time value/start value=1.005416666^nummonths =1.5

log(1.5)=nummonths*log(1.005416666)

so nummonths=log(1.5)/log(1.005416666)

=0.176091259/0.00234607991

=426.2429*0.176091259

=75 months or 6.25 yeers

###### anna get 10.5%, become 0.00875 per month

her invest gro...(1.00875)^75=1.922056

600$*1.9221=1,153.23$