WHAT A CARD!
The value, V, of a Honus Wagner baseball card in mint condition appreciates at 12% per year. It was sold at auction in 1991 for $461,000. If t = time in years since 1991, then V = 461000(1.12)t . Homework Help ✎
What was its value in 2000?
Find the average value of the card over the period 1991 - 2000.
When was the card worth the value you found in part (b)?
We are given a value function, V(t). Notice that t = years since 1991. Evaluate for the year 2000.
Value = V(t) = 461,100(1.12)t
Examine the equation above:
What is the annual interest rate?
What is the initial value of the card?
Unlike average value (AROC), actual value (IROC) must be found with a derivative.
Let V '(t) = your answer in part (b).
The card was worth its average value in 1995 or 1996.