I have an exponential growth / decay question. please help
when it says with an inflation rate of 5% per year what do i need to do ?
1.05^number of years
that didnt work , i tried it
what is the question?
Let y = 20,000(0.95)x represent the buying power of $20,000 with an inflation rate of 5% per year. The table below represents the first 4 years later. Which year is incorrect?
x- 1, 2, 3 ,4 y- 19,100- 18050-17148-16290
x- is years later y- purchasing power
well they have given you the entire formula. you literally only have to plug in x values. For x=1 you get \[20000(0.95)^1=20000(0.95)=19000\ne19100\]
i understand the formula , 20,000(.95)^x so you do 20,000 to the x power multiplied by (.95) . but i dont understand what i have to do to the formula when it says with an inflation of 5% per year ?
inflation rate of 5% per year "
this is already given in the forumla. Inflation means that the buying power of your dollar decreases. your buying power decreases by 5% so 1-0.05=0.95
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