Logs Worksheet 3

Interest: A= where A is the amount present at any given time, P is the principle, r is the annual rate, and n is the number of pay periods per year.

24. Assuming that Indians really did sell Manhattan for the legendary $24, and further assuming that the sale took place exactly 300 years ago, compute the amount of money the Indians would have had if they had placed the money in a bank that paid 5% interest per year, compounded annually, and kept it there until today.

25. John Maggio deposited his life savings at the Texas National Bank in September of his freshman year. In March he realized that while Texas National Bank was only paying 5% interest, Houston First Federal Bank would pay 6%. So, just 6 months after his initial investment, he transferred all of his money to Houston First Federal Bank. Ten years later (when he finally graduated college after repeated leaves-of-absence), he withdrew all of his money and found that he had $1000. How much was his initial investment if the interest was compounded quarterly?

26. You know how it is with homework: The farther you get the more tired you get and the slower it goes. Suppose you spend x minutes on the first question and each succeeding question takes as much time as all the previous questions combined. (question 2 takes x min, question 3 takes 2x min, and question 4 takes 4x min…) If 8 questions take 3 hours, how long did the first question take?

27. One quiet night in Alsace-Lorraine during WWI, Reggie Cramer won $500 playing poker with the other G.I.’s in his outfit. Not knowing what to do with the money, he deposited it in a bank. Two weeks later, that area was bombed heavily, and Reggie assumed that his money was gone. Miraculously, the banks records survived, and Last month, 50 years after the deposit was made, Reggie(now 74) received word that his account was still open. If Reggie’s money had been gaining 6% interest, compounded quarterly ever since it was deposited, How much is the account now worth?

28. A particularly prolific microorganism has baffled all of modern day science, by dividing into threes, not the normal two, every hour. If there are ten of these little bugs in a petri dish at 9:00 one morning, how many will there be by quitting time at 5:00?