Question

An Impressionist painting increases in value

Answer 1

Answer:

A = $8406.6

Step-by-step explanation:

Given:

Average rate $r=9\%$

Initial cost of painting $a = \ 1500$

Time $t = 20\ years$

We need to find the final amount of painting at the end of a 20-year.

Solution:

Using Exponential Growth rate formula as:

$A = a(1+r)^t$  ----------(1)

Where:

A = Final amount

a = Initial amount.

r = Rate as a decimal.

t = Time.

Now, we substitute all given values in equation 1.

$A = 1500(1+0.09)^{20}$

$A = 1500(1.09)^{20}$

Substitute $1.09^{20} = 5.60$ in above equation.

$A = 1500\times 5.60$

A = $8406.62

Therefore, value of the  painting at the end of  a 20-year A = $8406.6