Question

A piece of gold you purchased value increases at a rate of 7% each year. If the original value was $50, how much will it be worth 10 years later?

Answer 1

Answer:

$98.36

Explanation:

Given:

Original or initial amount(a) = $50

Rateof increase(r) in decimal = 7% = 7/100 = 0.07

Time(t) = 10 years

So we'll use the below exponential growth formula to determine the value of the gold 10 years later;

$\begin{gathered} y=a(1+r)^t \\ y=50(1+0.07)^{10} \\ y=50(1.07)^{10} \\ y=98.36 \end{gathered}$

So the piece of gold will be worth $98.36 10 years later.