Question

The price of a computer component is decreasing at a rate of 15​% per year. State whether this decrease is linear or exponential. If the component costs ​$60 ​today, what will it cost in three​ years? Is the decline in price linear or​ exponential?

Answer 1

Answer:

Since the price is given by an exponential function, the decline in price is exponential.

The component will cost $36.8475 in three years.

Step-by-step explanation:

The equation for the price of a component has the following format:

$P(t) = P(0)(1-r)^{t}$

In which P(t) is the price after t years, P(0) is the initial price, and r is the rate that the price decreases.

Since the price is given by an exponential function, the decline in price is exponential.

The price of a computer component is decreasing at a rate of 15​% per year.

This means that $r = 0.15$

Component costs ​$60 ​today

So P(0) = 60. Then

$P(t) = P(0)(1-r)^{t}$

$P(t) = 60(1-0.15)^{t}$

$P(t) = 60(0.85)^{t}$

What will it cost in three​ years?

This is P(3).

$P(t) = 60(0.85)^{t}$

$P(3) = 60(0.85)^{3} = 36.8475$

The component will cost $36.8475 in three years.