Question

This year Adeele paid £465 for her car insurance. This is an increase of 20% on last year's payment. How much did Adele pay last year?

Answer 1

Answer:

Insurance cost (last year)= £387.5

Step-by-step explanation:

Giving the following information:

Insurance cost= £465

Increase growth rate= 20% = 0.2

To calculate the cost of insurance last year, we need to use the following formula:

Insurance cost (last year)= insurance cost / (1 + insurance growth rate)

Insurance cost (last year)= 465 / (1 + 0.2)

Insurance cost (last year)= £387.5

Answer 2

The amount that Adele pay last year was:£387.5.

Car insurance:

Using this formula

Amount paid= Insurance cost / (1 + Insurance growth rate percentage)

Where:

Insurance cost= £465

Increase growth rate percentage=20% or 0.20

Let plug in the formula

Amount paid= £465 / (1 + 0.20)

Amount paid= £465/1.20

Amount paid= £387.5

Inconclusion the amount that Adele pay last year was:£387.5.

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