Cost of living is the amount required to purchase a certain fixed list of goods and services in one year. It is supposed to be subject to exponential growth. The growth rate is known as the inflation rate. If the cost of living rises from $ 10,000 to $ 11,000 in one year (a net increase of 10%), what is the instantaneous rate of increase in the cost of living in one year? Rta. 9.53% per year.
Cost of living is the amount required to purchase a certain fixed list of goods and services in one year. It is supposed to be subject to exponential growth. The growth rate is known as the inflation rate. If the cost of living rises from $ 10,000 to $ 11,000 in one year (a net increase of 10%), what is the instantaneous rate of increase in the cost of living in one year? Rta. 9.53% per year.
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Cost of living is the amount required to purchase a certain fixed list of goods and services in one year. It is supposed to be subject to exponential growth. The growth rate is known as the inflation rate. If the cost of living rises from $ 10,000 to $ 11,000 in one year (a net increase of 10%), what is the instantaneous rate of increase in the cost of living in one year? Rta. 9.53% per year.
Expert Solution
Step 1
The formula for the instantaneous growth is . Here, is the final value, is the initial value, r is the rate and t is the time.
Determine the value in the formula. Solve to get the value of the unknown.
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