Question

Find the average rate of change for the investor's plan and the 5-year CD between years 2 and 3, and between years 3 and 5. Explain what this shows in complete sentences.

Answer 1

@Hero

Answer 2

Use the formula for average rate of change

\(\dfrac{\Delta y}{\Delta x} = \dfrac{f(x_2) - f(x_1)}{x_2 - x_1}\)

Answer 3

okay what does this show

Answer 4

?

Answer 5

@Hero

Answer 6

Investor C:
(2,5170.72)
(5,5357.28)

5357.28-5170.72/5-2= 186.56/3= 62.18

Investor B:
(2,5277.53)
(5,5638.38)
5638.38-5277.53/5-2= 360.85/3= 120.28

5 year plan:

(2,5227.53)
(3,5345.15)

5345.15-5227.53/3-2= 117.62/1=117.62

(3,5345.15)
(5,5588.38)

5588.38-5345.15/5-3=243.23/2=121.615

Answer 7

Are you sure you calculated each correctly? According to the question you posted it says to Calculate Average rate of change between years 2 and 3 and between years 3 and 5.

Answer 8

yes, you got another answer

Answer 9

?

Answer 10

If you had to describe what the variables mean, you would put
x = investment year
y = total cumulative amount for any given investment year

So \(\dfrac{\Delta y}{\Delta x}\), in general, means the average rate of increase (or decrease) in the total cumulative amount earned for any given interval in years.

Answer 11

oh okay thank you

Answer 12

Recalculate your values carefully. Assuming your calculations for the 5 year plan are correct, you would say:

The average rate of increase for the investment period between year 2 and year 3 is $117.62 per year.

Answer 13

yes is that wrong?