If You Deposit $100 Now with Interest Rate of 3

question 91

Essay

If you deposit $100 now with interest rate of 3 percent, after the first period you will have an amount equal to (100 + 100* 0.03) = 100(1 + 0.03); after the second period the amount will be 100(1 + 0.03) + [100(1 + 0.03)]*0.03 = 100(1 + 0.03)(1 + 0.03) = 100(1 + 0.03)². If we continue this reasoning, we find out that the amount in the account after n periods is equal to $100(1 + 0.03)ⁿ. In general, if the interest rate is i percent, the formula for compound interest rate becomes (1 + i%/100)ⁿ.
-Suppose there is a tax rate of t percent on capital gain. How does our formula change?

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Definitions:

Linear Inequality

An algebraic inequality in which each term is either a constant or the product of a constant and a single variable.

Space Constraint

A limitation or restriction on the available space for a particular purpose or operation.

Floor Space

The total area taken up by all of the rooms or sections on one level of a building.

Linear Inequality

An algebraic inequality that shows the relationship between variables that form a straight line when graphed.