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Nonamiya [84]
2 years ago
5

An investment declines in value by 3% each month. By what percentage does its value decline in a year ?

Mathematics
1 answer:
babunello [35]2 years ago
6 0
\bf \qquad  \qquad  \textit{Annual Yield Formula}
\\\\
~~~~~~~~~~~~\left(1+\frac{r}{n}\right)^{n}-1
\\\\
\begin{cases}
r=rate\to 3\%\to \frac{3}{100}\to &0.03\\
n=
\begin{array}{llll}
\textit{times it compounds per year}\\
\textit{monthly, thus twelve}
\end{array}\to &12
\end{cases}
\\\\\\
\left(1+\frac{0.03}{12}\right)^{12}-1\implies 1.0025^{12}-1~~\approx ~~ 0.03041596
\\\\\\
r\%=0.03041596\cdot 100\implies r\approx\stackrel{\%}{3.04}
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Step-by-step explanation:

x

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(

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(

x

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x

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(

−

∞

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,

(

−

3

,

−

1

)

,

(

−

1

,

2

)

,

(

2

,

4

)

and

(

4

,

∞

)

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+

−

+

−

+

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(

−

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2

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