Part 1) Finding the inverse
Let x = r and y = H(r)
We have the equation y = 6240(1 + x/100)^t which is the same as saying y = 6240(1 + 0.01x)^t since 1/100 = 0.01
From here, swap x and y to get the equation x = 6240(1+0.01y)^t
Let's solve for y
x = 6240(1+0.01y)^t
6240(1+0.01y)^t = x
(1+0.01y)^t = x/6240
1+0.01y = (x/6240)^(1/t)
0.01y = (x/6240)^(1/t)-1
100*0.01y = 100*((x/6240)^(1/t)-1)
y = 100*((x/6240)^(1/t)-1)
y = 100*(x/6240)^(1/t) - 100
This becomes r = 100*(H/6240)^(1/t) - 100 after we replace y with r and x with H. Note the r and H swapped places, just like x and y did. Earlier we had H isolated on the left, but now r is isolated on the left.
We could write r(H) = 100*(H/6240)^(1/t) - 100 to mean the same thing.
So what exactly does this inverse function do? Well the original function tells us the number of households for any given growth rate, which is r.
The inverse function swaps things around to allow us to find the growth rate if we know how many households there are. We're working backwards. In both cases, t is held to some constant fixed value.
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Part 2) Finding the growth rate if the number of households is 7800 after 3 years.
We're going to plug in H = 7800 and t = 3 into the inverse function we found to determine the value of r, or r(H)
r(H) = 100*(H/6240)^(1/t) - 100
r(7800) = 100*(7800/6240)^(1/3) - 100
r(7800) = 7.72173450159419
You'll need your calculator to get this approximate value. After rounding to two decimal places, we get r(7800) = 7.72
Since r = 7.72, this means the growth rate is 7.72%
