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Math Help - Exponential word problem

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    Senior Member vaironxxrd's Avatar
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    Exponential word problem

    Use the formula, A = P (1+\frac{r}{n})^n^t, to answer the following questions.

    A bank offers you two options for investing 5000. Option 1 offers 3.6% interest, compunded yearly. Option 2 offers 3.4% interest compunded monthly. You will invest your money for 4 years.

    a. Which option offers the better deal?
    I'm really going to try and make some sense but I really cannot understand yet how to correctly use the formula.
    Since I have been using logs in class, does it have something to do with logs if so can I be guided in that direction?

    b. How much more money will you earn by choosing that option?
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    Re: Exponential word problem

    Exponential word problem-compdint.jpg
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