an oil well produceds 2500 barrels of oil during its firt month of production. The oil company predicts its production will drop 5% each month thereafter. how many barrels of iol will this company produce in its first yeear?
what formula would I use and I how I do this question?
To determine the number of barrels of oil the company will produce in its first year, you need to calculate the monthly production for each month and sum it up.
To solve this question, you need to use the formula for exponential decay, which in this case is:
Monthly Production = Initial Production * (1 - Decay Rate)^Number of Months
Let's break down the steps to calculate the production for each month and then sum them up:
Step 1: Calculate the production for the first month
The initial production for the first month is 2500 barrels.
Step 2: Calculate the production for the remaining months
Since the production will decrease by 5% each month, the decay rate is 5% in decimal form, which is 0.05.
To calculate the production for each subsequent month, you can plug in the values into the formula:
Monthly Production = 2500 * (1 - 0.05)^(Number of Months)
Number of Months values would be from month 2 to month 12.
Step 3: Sum up the production for all months
Add up the production values from the first month and the production for each subsequent month.
Let's calculate the production for each month:
Production for month 1 = 2500 barrels
Production for month 2 = 2500 * (1 - 0.05)^(2-1)
Production for month 3 = 2500 * (1 - 0.05)^(3-1)
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Production for month 12 = 2500 * (1 - 0.05)^(12-1)
Now add up the production values for all 12 months.
Total Production for the first year = Production for month 1 + Production for month 2 + ... + Production for month 12
By following these steps, you can calculate the total number of barrels of oil the company will produce in its first year.