Question

The median household in the United States increased by a rate of 0.25% each year between 1980 and 1985. If the median household income was $42,050 in 1980, what was the median household income after 5 years? Round answer to the nearest whole dollar.

Answer 1

Using an exponential function, the median household income after 5 years was of $42,578.

What is an exponential function?

An increasing exponential function is modeled by:

$A(t) = A(0)(1 + r)^t$

In which:

• A(0) is the initial value.

• r is the growth rate, as a decimal.

For this problem, the parameters are:

A(0) = 42050, t = 5, r = 0.0025[/tex]

Hence:

$A(t) = A(0)(1 + r)^t$

$A(t) = 42050(1.0025)^t$

$A(5) = 42050(1.0025)^5 = 42578$

More can be learned about exponential functions at https://brainly.com/question/25537936

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