Jacob has not paid his $320 credit card bill and it was sent to collections. His
ID: 3029439 • Letter: J
Question
Jacob has not paid his $320 credit card bill and it was sent to collections. His interest rate is 43%, compounded daily.
1. Wrte an exponential function that models this situation where y is the balance of Jacob's account and x is time in years.
2. Use your equation from problem 24 to complete the chart to right; round to the nearest cent.
3. Use your data from problem 25 to graph your equation from problem 24. ( Use an x- scale of .5 years and a y- scale of $100.)
4. If Jacob left his account unpaid in 2009, calculate the expected balance in 2014 if he has not paid. Show your calulations and consider the trend of your graph above. (Recall that 2012 is a leap year.)
2. Use your equation from problem 24 to complete the chart to right; round to the nearest cent.
3. Use your data from problem 25 to graph your equation from problem 24. ( Use an x- scale of .5 years and a y- scale of $100.) I need the graph for quesrion
years 5 1 1.5 2 2.5 3 balanceExplanation / Answer
1. Most financial computers do not carry enough digits to keep track of Jacob's balance if the interest rate is the illegally high value of 43% compounded daily. At the end of 61 days, Jacob would owe a balance of $1 trillion. His balance after 3 years would take over 170 digits to describe it.
We assume the daily rate is 0.43%. This puts the annual multiplier at 1.0043^365 = 4.78811.
Jacob's balance (y) after x years is
.. y = 320*4.78811^x
for years 1 plug x=1
then we get y=1532.9
in similer way find for all other values
2. (1.0, 1532.19), (2.0, 7336.31), (2.5, 16053.10), (3.0, 35127.05)
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