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8. A well-balanced stock market portfolio will often experience an exponential growth. A

particular investor with a well-balanced stock market portfolio records the portfolio balance
every month, in thousands of dollars, from the date of investment. The roughly exponential
growth can be transformed to a linear model by plotting the natural log of the balances
versus time, in months, where t - 0 represents the date the money was invested. The linear
regression equation for the transformed data is
In (balance)-5.550 + 0.052t.
Using this equation, what is the predicted balance of the portfolio after 2 years (24 months)?
(A) $5,654
(B) $6,798
(C) $285,431
(D) $896,053
(E) $948,464

User Rick Wayne
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3 votes

Answer:

D) $896,053

Explanation:

User Sam Stone
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