Natural Log Question: How do I solve 20,000 = (1 + r)^5 ?

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daisy
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Natural Log Question: How do I solve 20,000 = (1 + r)^5 ?

Postby daisy » Sun Jul 05, 2009 11:45 pm

How do I solve for r?

20000 = (1 + r)^5

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stapel_eliz
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Postby stapel_eliz » Mon Jul 06, 2009 1:49 pm

daisy wrote:How do I solve for r?

20000 = (1 + r)^5

From your subject line, I will guess that you are supposed to solve by using logs. To learn how to solve exponential equations, try here. Then note that:

. . . . .

...and see where that leads. :wink:

daisy
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Re: Natural Log Question: How do I solve 20,000 = (1 + r)^5 ?

Postby daisy » Mon Jul 06, 2009 5:37 pm

so... 20000 = 5 x ln(1 + r)... I concur with this statement.
But how do you evaluate ln(1 + r) in a attempt to solve the equation for "r"?

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stapel_eliz
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Postby stapel_eliz » Mon Jul 06, 2009 5:59 pm

You'd have to switch back to exponential form, evaluate, and then subtract the 1.

(It would have been simpler to use roots, rather than logs, but I followed what you'd specified in your subject line.)

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Re: Natural Log Question: How do I solve 20,000 = (1 + r)^5 ?

Postby daisy » Mon Jul 06, 2009 6:38 pm

I get it! Equation solved. Many thanks.


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