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A ( t ) = P ( 1 + r n ) n t .

What happens as n ? To answer this question, we let m = n / r and write

( 1 + r n ) n t = ( 1 + 1 m ) m r t ,

and examine the behavior of ( 1 + 1 / m ) m as m , using a table of values ( [link] ).

Values of ( 1 + 1 m ) m As m
m 10 100 1000 10,000 100,000 1,000,000
( 1 + 1 m ) m 2.5937 2.7048 2.71692 2.71815 2.718268 2.718280

Looking at this table, it appears that ( 1 + 1 / m ) m is approaching a number between 2.7 and 2.8 as m . In fact, ( 1 + 1 / m ) m does approach some number as m . We call this number e    . To six decimal places of accuracy,

e 2.718282 .

The letter e was first used to represent this number by the Swiss mathematician Leonhard Euler during the 1720s. Although Euler did not discover the number, he showed many important connections between e and logarithmic functions. We still use the notation e today to honor Euler’s work because it appears in many areas of mathematics and because we can use it in many practical applications.

Returning to our savings account example, we can conclude that if a person puts P dollars in an account at an annual interest rate r , compounded continuously, then A ( t ) = P e r t . This function may be familiar. Since functions involving base e arise often in applications, we call the function f ( x ) = e x the natural exponential function    . Not only is this function interesting because of the definition of the number e , but also, as discussed next, its graph has an important property.

Since e > 1 , we know e x is increasing on ( , ) . In [link] , we show a graph of f ( x ) = e x along with a tangent line to the graph of at x = 0 . We give a precise definition of tangent line in the next chapter; but, informally, we say a tangent line to a graph of f at x = a is a line that passes through the point ( a , f ( a ) ) and has the same “slope” as f at that point . The function f ( x ) = e x is the only exponential function b x with tangent line at x = 0 that has a slope of 1. As we see later in the text, having this property makes the natural exponential function the most simple exponential function to use in many instances.

An image of a graph. The x axis runs from -3 to 3 and the y axis runs from 0 to 4. The graph is of the function “f(x) = e to power of x”, an increasing curved function that starts slightly above the x axis. The y intercept is at the point (0, 1). At this point, a line is drawn tangent to the function. This line has the label “slope = 1”.
The graph of f ( x ) = e x has a tangent line with slope 1 at x = 0 .

Compounding interest

Suppose $ 500 is invested in an account at an annual interest rate of r = 5.5 % , compounded continuously.

  1. Let t denote the number of years after the initial investment and A ( t ) denote the amount of money in the account at time t . Find a formula for A ( t ) .
  2. Find the amount of money in the account after 10 years and after 20 years.
  1. If P dollars are invested in an account at an annual interest rate r , compounded continuously, then A ( t ) = P e r t . Here P = $ 500 and r = 0.055 . Therefore, A ( t ) = 500 e 0.055 t .
  2. After 10 years, the amount of money in the account is
    A ( 10 ) = 500 e 0.055 · 10 = 500 e 0.55 $ 866.63 .

    After 20 years, the amount of money in the account is
    A ( 20 ) = 500 e 0.055 · 20 = 500 e 1.1 $ 1 , 502.08 .
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If $ 750 is invested in an account at an annual interest rate of 4 % , compounded continuously, find a formula for the amount of money in the account after t years. Find the amount of money after 30 years.

A ( t ) = 750 e 0.04 t . After 30 years, there will be approximately $ 2 , 490.09 .

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Logarithmic functions

Using our understanding of exponential functions, we can discuss their inverses, which are the logarithmic functions. These come in handy when we need to consider any phenomenon that varies over a wide range of values, such as pH in chemistry or decibels in sound levels.

Questions & Answers

can you give me a problem for function. a trigonometric one
geovanni Reply
state and prove L hospital rule
Krishna Reply
I want to know about hospital rule
If you tell me how can I Know about engineering math 1( sugh as any lecture or tutorial)
I don't know either i am also new,first year college ,taking computer engineer,and.trying to advance learning
if you want some help on l hospital rule ask me
it's spelled hopital
you are correct Connor Angeli, the L'Hospital was the old one but the modern way to say is L 'Hôpital.
I had no clue this was an online app
Total online shopping during the Christmas holidays has increased dramatically during the past 5 years. In 2012 (t=0), total online holiday sales were $42.3 billion, whereas in 2013 they were $48.1 billion. Find a linear function S that estimates the total online holiday sales in the year t . Interpret the slope of the graph of S . Use part a. to predict the year when online shopping during Christmas will reach $60 billion?
Nguyen Reply
what is the derivative of x= Arc sin (x)^1/2
morfling Reply
y^2 = arcsin(x)
x = sin (y^2)
differentiate implicitly
then solve for dy/dx
thank you it was very helpful
questions solve y=sin x
Obi Reply
Solve it for what?
you have to apply the function arcsin in both sides and you get arcsin y = acrsin (sin x) the the function arcsin and function sin cancel each other so the ecuation becomes arcsin y = x you can also write x= arcsin y
what is the question ? what is the answer?
there is an equation that should be solve for x
ok solve it
are you saying y is of sin(x) y=sin(x)/sin of both sides to solve for x... therefore y/sin =x
or solve for sin(x) via the unit circle
what is unit circle
a circle whose radius is 1.
the unit circle is covered in pre cal...and or trigonometry. it is the multipcation table of upper level mathematics.
what is function?
Ryan Reply
A set of points in which every x value (domain) corresponds to exactly one y value (range)
what is lim (x,y)~(0,0) (x/y)
NIKI Reply
limited of x,y at 0,0 is nt defined
But using L'Hopitals rule is x=1 is defined
Could U explain better boss?
value of (x/y) as (x,y) tends to (0,0) also whats the value of (x+y)/(x^2+y^2) as (x,y) tends to (0,0)
can we apply l hospitals rule for function of two variables
why n does not equal -1
K.kupar Reply
ask a complete question if you want a complete answer.
I agree with Andrew
f (x) = a is a function. It's a constant function.
Darnell Reply
proof the formula integration of udv=uv-integration of vdu.?
Bg Reply
Find derivative (2x^3+6xy-4y^2)^2
Rasheed Reply
no x=2 is not a function, as there is nothing that's changing.
Vivek Reply
are you sure sir? please make it sure and reply please. thanks a lot sir I'm grateful.
i mean can we replace the roles of x and y and call x=2 as function
if x =y and x = 800 what is y
Joys Reply
how do u factor the numerator?
Drew Reply
Nonsense, you factor numbers
You can factorize the numerator of an expression. What's the problem there? here's an example. f(x)=((x^2)-(y^2))/2 Then numerator is x squared minus y squared. It's factorized as (x+y)(x-y). so the overall function becomes : ((x+y)(x-y))/2
The problem is the question, is not a problem where it is, but what it is
I think you should first know the basics man: PS
Yes, what factorization is
Antonio bro is x=2 a function?
Yes, and no.... Its a function if for every x, y=2.... If not is a single value constant
you could define it as a constant function if you wanted where a function of "y" defines x f(y) = 2 no real use to doing that though
Why y, if domain its usually defined as x, bro, so you creates confusion
Its f(x) =y=2 for every x
Yes but he said could you put x = 2 as a function you put y = 2 as a function
F(y) in this case is not a function since for every value of y you have not a single point but many ones, so there is not f(y)
x = 2 defined as a function of f(y) = 2 says for every y x will equal 2 this silly creates a vertical line and is equivalent to saying x = 2 just in a function notation as the user above asked. you put f(x) = 2 this means for every x y is 2 this creates a horizontal line and is not equivalent
The said x=2 and that 2 is y
that 2 is not y, y is a variable 2 is a constant
So 2 is defined as f(x) =2
No y its constant =2
what variable does that function define
the function f(x) =2 takes every input of x within it's domain and gives 2 if for instance f:x -> y then for every x, y =2 giving a horizontal line this is NOT equivalent to the expression x = 2
Yes true, y=2 its a constant, so a line parallel to y axix as function of y
Sorry x=2
And you are right, but os not a function of x, its a function of y
As function of x is meaningless, is not a finction
yeah you mean what I said in my first post, smh
I mean (0xY) +x = 2 so y can be as you want, the result its 2 every time
OK you can call this "function" on a set {2}, but its a single value function, a constant
well as long as you got there eventually
2x^3+6xy-4y^2)^2 solve this
follow algebraic method. look under factoring numerator from Khan academy
volume between cone z=√(x^2+y^2) and plane z=2
Kranthi Reply
answer please?
It's an integral easy
V=1/3 h π (R^2+r2+ r*R(
Practice Key Terms 7

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