Stuck

[nz.lauren]

Hi,

I have (1 + 0.12 / 2)^2 = (1 + r/12)^12, solve for r. r should equal 0.117106, but I can't get to this result.

I'm trying to solve like this:

0.1236 = (1 + r/12)^12

0.1236^(1/12) = 1 + r/12

0.840107521 = 1 + r/12

12 * 0.840107521 = 1+ r

r = 9.0812902

Clearly I'm doing something stupid but I don't know what. Is it a problem with my order of operations? I've tried other orders but can't make it work.

Thanks!

 

[srmichael]

Hi,

I have (1 + 0.12 / 2)^2 = (1 + r/12)^12, solve for r. r should equal 0.117106, but I can't get to this result.

I'm trying to solve like this:

0.1236 = (1 + r/12)^12 See [1] below

0.1236^(1/12) = 1 + r/12

0.840107521 = 1 + r/12

12 * 0.840107521 = 1+ r See [2] below

r = 9.0812902

Clearly I'm doing something stupid but I don't know what. Is it a problem with my order of operations? I've tried other orders but can't make it work.

Thanks!

[1]: [1 + (.12/2)]² = 1.1236 NOT 0.1236

[2]: When you multiply everything by 12 make sure you multiply EVERYTHING by 12, including the 1 in the 1 + r/12 term.

 

[HallsofIvy]

Hi,

I have (1 + 0.12 / 2)^2 = (1 + r/12)^12, solve for r. r should equal 0.117106, but I can't get to this result.

I'm trying to solve like this:

0.1236 = (1 + r/12)^12

Personally, I would have started by taking the square root of both sides: (1+ 0.06)= (1+ r/12)^6.

Now, take the sixth root of both sides \(\displaystyle \sqrt[6]{1.06}= 1.0098= 1+ r/12\) so that r/12= .0098 and r= 12(.0098)= .1171

0.1236^(1/12) = 1 + r/12

0.840107521 = 1 + r/12

12 * 0.840107521 = 1+ r

Unless you meant (1+ r)/12, this is wrong. with .840107521= 1+ (r/12), multiplying both sides by 12 gives 12*.840107521= (1+ r/12)(12)= 12+ r/12.

r = 9.0812902

Clearly I'm doing something stupid but I don't know what. Is it a problem with my order of operations? I've tried other orders but can't make it work.

Thanks!

 

[nz.lauren]

Thanks guys. It's always upsetting to come back the next day and realise you were doing something truly stupid (like forgetting to add the 1 in (1 + 0.12/ 2)^2).

Dennis, I'm actually from NZ, doing a course in Australia - guess we stuck with the Canadian way too!

Thanks!