Answer:
Step-by-step explanation:
The rate at which the value of the company increased is exponential.
We would apply the formula for exponential growth which is expressed as
A = P(1 + r)^t
Where
A represents the value of the company after t years.
t represents the number of years.
P represents the initial value of the company.
r represents rate of growth.
From the information given,
P = 2.1 million
r = 2% = 2/100 = 0.02
t = x years
The function to represent the value of the company, x years after being founded is
A = 2.1 × 106(1 + 0.02)^x
Therefore, the worth of the company in 6 years is
A = 2.1 × 106(1 + 0.02)^16
A = 2.1 × 10^6(1.02)^6
2364941
The worth of the company in 2 years is
A = 2.1 × 10^6(1 + 0.02)^2
A = 2.1 × 10^6(1.02)^2
A = 2184840
The difference in worth of the company after 6 years and after 2 years is
2364941 - 2184840 = $180101
