Question

What is the growth factor that corresponds to a product that increases its value first by 2%, and then increases by 5% of its value, and finally increases by 12% of its value? Round to the tenths place.

Answer 1

An amount starts as 100%. If it increases by 2%, that means the amount becomes 102% of what it was. When it increases by 5%, it becomes 105% of what it was. The same happens with 12%, and it beomes 112% of what it was.

Therefore, the increases of 2%, 5%, and 12% are the same as:

1.02 * 1.05 * 1.12