Question

The value of Adam's model railway is $550.
This value increases exponentially at a rate of r %
per year.
At the end of 5 years the value will be $736.
Calculate the value of r.

Answer 1

Answer:(c)

Step-by-step explanation:

Given

The initial value of Adam's model is $A_o=\ 550$

the value increases exponentially with the rate of $r\%$

Time period $t=5\ years$

Final amount $A=\ 736$

Exponential growth is given by

$\Rightarrow A=A_o(1+r)^t$

Putting values

$\Rightarrow 736=550(1+r)^5\\\\\Rightarrow (1+r)^5=1.338$

$\Rightarrow 1+r=1.05999\\\Rightarrow r=0.05999\ or\ 5.99\%\approx 6\%$

Option (c) is correct