Question

1) Sawyer Corporation's 2018 sales were $9 million. Its 2013 sales were $4.5 million.

1. At what rate have sales been growing? Round your answer to two decimal places.

     %

2. Suppose someone made this statement: "Sales doubled in 5 years. This represents a growth of 100% in 5 years; so dividing 100% by 5, we find the growth rate to be 20% per year." Is the statement correct?

2)Find the interest rates earned on each of the following. Round your answers to the nearest whole number.

1. You borrow $680 and promise to pay back $782 at the end of 1 year._____ %

2. You lend $680 and the borrower promises to pay you $782 at the end of 1 year. _____%

3. You borrow $63,000 and promise to pay back $146,894 at the end of 11 years._____ %

4. You borrow $20,000 and promise to make payments of $6,687.60 at the end of each year for 5 years._____  %

3)How long will it take $500 to double if it earns the following rates? Compounding occurs once a year. Round your answers to two decimal places.

1. 4%. ______ year(s)

2. 13%. _______ year(s)

3. 17%. ______ year(s)

4. 100%. ______ year(s)

Answer 1

Answer:

1) Sawyer Corporation's 2018 sales were $9 million. Its 2013 sales were $4.5 million.

1. At what rate have sales been growing? Round your answer to two decimal places.

   Ans: 14.87 % [{($9M/$4.5M)^(1/5)-1}]*100

2. Suppose someone made this statement: "Sales doubled in 5 years. This represents a growth of 100% in 5 years; so dividing 100% by 5, we find the growth rate to be 20% per year." Is the statement correct?
   Ans: Incorrect ( as seen from above the correct answer)

2)Find the interest rates earned on each of the following. Round your answers to the nearest whole number.

1. You borrow $680 and promise to pay back $782 at the end of 1 year._____ 15% [(782-680)/680]*100

2. You lend $680 and the borrower promises to pay you $782 at the end of 1 year. _____15% [(782-680)/680]*100%

3. You borrow $63,000 and promise to pay back $146,894 at the end of 11 years._____ 8% [((146894-63000)/63000)^(1/11)-1]*100

4. You borrow $20,000 and promise to make payments of $6,687.60 at the end of each year for 5 years._____24.5 % [(20000/6687.6)^(1/5)-1]*100

3)How long will it take $500 to double if it earns the following rates? Compounding occurs once a year. Round your answers to two decimal places. [ formula: years = log(1000/500)/log(1+r) ] or use future value tables.

1. 4%. ______17.67 year(s)

2. 13%. _______5.67 year(s)

3. 17%. ______ 4.42year(s)

4. 100%. ______ 1.00year(s)

Thank you.