Question

Since 2004​, the amount of money spent at restaurants in a certain country has increased at a rate of 6​% each year. In 2004​, about ​$510 billion was spent at restaurants. If the trend​ continues, about how much will be spent at restaurants in 2012​?
About ​$
nothing billion will be spent at restaurants in 2012 if the trend continues.

Answer 1

$812 billion will be spent at the restaurants if the trend continues.

Explanation

It is given that the amount spent on restaurants increase by 6% every year.

The amount spent on each of the following years can be determined by solving it using the method used to calculate compound interest.

Amount spent in 2004=$510 billion

Annual rate of interest=6%

we have to calculate the amount spent in 2012

number of years n=8

Amount spent= $initial amount*(1+r/100)^{n} \\510(1+6/100)^8\\510*(1+0.06)^8\\510*1.06^8\\= 812 billion$