+0  
 
0
698
1
avatar
the value of an item increases 25% in 10 years, what is its annual rater of growth?
 Nov 4, 2013
 #1
avatar+118654 
0
the value of an item increases 25% in 10 years, what is its annual rater of growth?

Let the initial value be $1 and the value after 10 years be $1.25
Let r be the annual growth rate (as a decimal)

1.25 = 1 * (1+r)^10

the tenth root of 1.25 = 1+r
1+r = 1.25 ^ 0.1
1+r = 1.022565
r=0.022565
annual rate = 2.2565% approx
 Nov 4, 2013

4 Online Users

avatar