Question

Annual sales for a fast food restaurant are 650000 and are increasing at a rate of 4% per year. Use an exponential function to find the annual sales after 7 years.

Answer 1

The value after 7 years is $ 855355.65

Solution:

Given that, Annual sales for a fast food restaurant are 650000 and are increasing at a rate of 4% per year

To find:  exponential function to find the annual sales after 7 years

The exponential growth function is given as:

$y = a(1+r)^t$

Where,

"a" is the initial amount

"y" is the future value

"r" is the rate of interest in decimal

"t" is the number of years

Here in this given question,

a = 650000

t = 7 years

$r = 4 \% = \frac{4}{100} = 0.04$

Substituting the values in given formula,

$y = 650000(1+0.04)^7\\\\y = 650000(1.04)^7\\\\y = 650000 \times 1.31593\\\\y = 855355.65$

Thus the value after 7 years is $ 855355.65