Question

The value of a stock share in a new technology company has been increasing at a rate of 8.6% quarterly. The initial price of one share was $102.15. An investor plans to sell once the value of one share reaches $233.10. If t is the number of quarters since the initial price of one share was set, which equation could be used to determine how long it will take the share to reach $233.10, assuming it continues to grow at the same rate?

Answer 1

Answer: 39 quarter

The value of a stock share in a new technology company has been increasing at a rate of 8.6% quarterly. That means the stock will increase by 8.6%/4= 2.15% rate per quarter. The exponent function to find the number of money the investor have would be:
an= $102.15(1.0215)^t

The time needed for getting $233.10 would be:

an= $102.15(1.0215)^t
$233.10= $102.15(1.0215)^t
2.2819 * $102.15= $102.15( 1.0215)^t
2.2819 = (1.0215)^t
t= log1.0215 2.2819
t= 39

Answer 2

Answer:

Rate of interest = 8.6% or 0.086

The initial price of one share was $102.15. An investor plans to sell once the value of one share reaches $233.10.

If t is the number of quarters since the initial price of one share was set, then the equation that could be used to determine how long it will take the share to reach $233.10 is : 233.10 = 102.15(1.086)^t