Algebra II
posted by Anonymous on .
Growth and Decay
Dave bought a new car 8 years ago for $8400. Tobuy a new car comparably equipped now would cost $12,500. Assuming a steady rate of increase, what was the yearly rate of inflation in car prices over the 8year period?
Is there an equation and could someone post the answer and (if someone could post the steps)?

8400 + 8x = 12500
8x = 4100
x = $512.50 (amount of inflation per year)
Note that you cannot convert this to percent rate because it wouldn't be steady. For the first year, 512.5/8400 = 6.1%. For the second year, the car is going to cost 8912.5, and 512.5/8912.5 = 5.75%. And so on...