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Statistics Help

**Question: **Plot the function A(t)..... Edit

**Answer: **In the graph above c= 2500, is held constant and k=0.5 is held constant. r varies from 0 (lowest graph) to 0.06 (highest graph) in increments of 0.01. The most striking feature of the graph is that no matter what is, the graph goes through the same point at time t= 40 . But that makes sense, because t = 40 corresponds to the card owner not selling the card until he is ready to retire, in which case the interest it could have earned in the bank (but didn’t) doesn’t matter. We also note that for relatively low values of , there is no advantage to selling the card before retirement, and for higher values of , the optimal selling time is sooner the greater is. That makes sense, because if your bank pays you lots of interest, then it is to your advantage to have money in the bank for a long time—hence, selling the card sooner. Edit

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