Friday
November 28, 2014

Homework Help: math

Posted by Daniel on Sunday, April 7, 2013 at 12:29pm.

Confused!


So here is the question:
Inflation is currently causing the cost of items to increase by about 2.5% per year. In 2009 a litre of gasoline costs approximately $0.90. What will it cost to fill a 60 litre gas tank 10 years from now. Round your answer to the nearest dollar. Name at least one thing other than inflation that determines the cost to the consumer of any article (not just gasoline).

For the mathematical portion, what would be the correct answer?

A = (0.9(1+0.25)^(10)) (60)

60 = # of litres
earlier portion of equation = cost of gas (per litre)

OR

Is the answer..

math - Wayne, Tuesday, April 2, 2013 at 4:35pm

Today it costs $54 to fill tank. In one year (per cent increase problem):
(x - 54)/54 = .025, so x = $55.35
in the next year:
(x - $55.35)/$55.35 = .025, so x = $56.73
Do this 8 more times, and you will get your answer: $69.12
I used an Excel worksheet to generate the answer. Not sure if there's a formula to solve this or not.
math - Wayne, Tuesday, April 2, 2013 at 4:40pm

There is a formula, called the standard future value formula:
54 * (1 + .025)^10 = future value = $69.12

Thanks,

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