So far we have worked with rational bases for exponential functions. For most real-world phenomena, however,
e is used as the base for exponential functions. Exponential models that use
as the base are called
continuous growth or decay models . We see these models in finance, computer science, and most of the sciences, such as physics, toxicology, and fluid dynamics.
The continuous growth/decay formula
For all real numbers
and all positive numbers
and
continuous growth or decay is represented by the formula
where
is the initial value,
is the continuous growth rate per unit time,
and
is the elapsed time.
If
, then the formula represents continuous growth. If
, then the formula represents continuous decay.
For business applications, the continuous growth formula is called the continuous compounding formula and takes the form
where
is the principal or the initial invested,
is the growth or interest rate per unit time,
and
is the period or term of the investment.
Given the initial value, rate of growth or decay, and time
solve a continuous growth or decay function.
Use the information in the problem to determine
, the initial value of the function.
Use the information in the problem to determine the growth rate
If the problem refers to continuous growth, then
If the problem refers to continuous decay, then
Use the information in the problem to determine the time
Substitute the given information into the continuous growth formula and solve for
Calculating continuous growth
A person invested $1,000 in an account earning a nominal 10% per year compounded continuously. How much was in the account at the end of one year?
Since the account is growing in value, this is a continuous compounding problem with growth rate
The initial investment was $1,000, so
We use the continuous compounding formula to find the value after
year:
Radon-222 decays at a continuous rate of 17.3% per day. How much will 100 mg of Radon-222 decay to in 3 days?
Since the substance is decaying, the rate,
, is negative. So,
The initial amount of radon-222 was
mg, so
We use the continuous decay formula to find the value after
days:
Using the data in
[link] , how much radon-222 will remain after one year?
3.77E-26 (This is calculator notation for the number written as
in scientific notation. While the output of an exponential function is never zero, this number is so close to zero that for all practical purposes we can accept zero as the answer.)
In economics, a perfect market refers to a theoretical construct where all participants have perfect information, goods are homogenous, there are no barriers to entry or exit, and prices are determined solely by supply and demand. It's an idealized model used for analysis,
When MP₁ becomes negative, TP start to decline.
Extuples Suppose that the short-run production function of certain cut-flower firm is given by: Q=4KL-0.6K2 - 0.112 •
Where is quantity of cut flower produced, I is labour input and K is fixed capital input (K-5). Determine the average product of lab
Kelo
Extuples Suppose that the short-run production function of certain cut-flower firm is given by: Q=4KL-0.6K2 - 0.112 •
Where is quantity of cut flower produced, I is labour input and K is fixed capital input (K-5). Determine the average product of labour (APL) and marginal product of labour (MPL)
Quantity demanded refers to the specific amount of a good or service that consumers are willing and able to purchase at a give price and within a specific time period. Demand, on the other hand, is a broader concept that encompasses the entire relationship between price and quantity demanded
Ezea
ok
Shukri
how do you save a country economic situation when it's falling apart
Economic growth as an increase in the production and consumption of goods and services within an economy.but
Economic development as a broader concept that encompasses not only economic growth but also social & human well being.
Shukri
production function means
Jabir
What do you think is more important to focus on when considering inequality ?
sir...I just want to ask one question... Define the term contract curve? if you are free please help me to find this answer 🙏
Asui
it is a curve that we get after connecting the pareto optimal combinations of two consumers after their mutually beneficial trade offs
Awais
thank you so much 👍 sir
Asui
In economics, the contract curve refers to the set of points in an Edgeworth box diagram where both parties involved in a trade cannot be made better off without making one of them worse off. It represents the Pareto efficient allocations of goods between two individuals or entities, where neither p
Cornelius
In economics, the contract curve refers to the set of points in an Edgeworth box diagram where both parties involved in a trade cannot be made better off without making one of them worse off. It represents the Pareto efficient allocations of goods between two individuals or entities,
Cornelius
Suppose a consumer consuming two commodities X and Y has
The following utility function u=X0.4 Y0.6. If the price of the X and Y are 2 and 3 respectively and income Constraint is birr 50.
A,Calculate quantities of x and y which maximize utility.
B,Calculate value of Lagrange multiplier.
C,Calculate quantities of X and Y consumed with a given price.
D,alculate optimum level of output .
the market for lemon has 10 potential consumers, each having an individual demand curve p=101-10Qi, where p is price in dollar's per cup and Qi is the number of cups demanded per week by the i th consumer.Find the market demand curve using algebra. Draw an individual demand curve and the market dema
suppose the production function is given by ( L, K)=L¼K¾.assuming capital is fixed find APL and MPL. consider the following short run production function:Q=6L²-0.4L³ a) find the value of L that maximizes output b)find the value of L that maximizes marginal product