Linear and Quadratic Approximation
Linear and Quadratic Approximation
Read: SN: A.
(continued)
1
18.01A topic 1 2
(continued)
18.01A topic 1 3
Examples:
Suppose you have $1000 in bank at 2% continuous interest. Approximately how much
money is in the bank after 1 year? After 2 years?
answer: Balance = f (t) = 1000e.02t ≈ 1000(1 + .02t + (.02t)2 /2).
f (1) ≈ 1000(1 + .02 + .0002) = 1020.20.
f (2) ≈ 1000(1 + .04 + .0008) = 1040.80.