Chapter 4, Problem 12RE

### Calculus: An Applied Approach (Min...

10th Edition
Ron Larson
ISBN: 9781305860919

Chapter
Section

### Calculus: An Applied Approach (Min...

10th Edition
Ron Larson
ISBN: 9781305860919
Textbook Problem
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# Inflation Rate With an annual rate of inflation of 2% over the next 10 years, the approximate cost C of goods or services during any year in the decade is given by C ( t ) =   P ( 1.02 ) t ,   0   < t ≤   10 where t is the time in years and P is the present cost. The price of a graphing calculator is presently $120. Estimate the price 10 years from now. To determine To calculate: The price of graphing calculator after 10 years if present price is$120 and an annual inflation rate is 2% over next 10 years where the model C(t)=P(1.02)t, 0t10 approximates the cost of goods and services in any year in the period, if t is time in years and P is current cost.

Explanation

Given Information:

The model C(t)=P(1.02)t,  0t10 represents the cost of goods and services in any year in the period, if t is time in years and P is present cost. Also, the present cost of a graphing calculator is $120. Calculation: Consider the model, C(t)=P(1.02)t The present cost of a graphing calculator is$120.

Therefore, when t=0, C=120.

Substitute both values in C(t)=P(1.02)t.

C(t)=P(1

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Applied Calculus for the Managerial, Life, and Social Sciences: A Brief Approach