Question

The price f(x), in dollars, of fuel A after x months is represented by the function below:

f(x) = 2.15(0.98)x

Is the price of fuel A increasing or decreasing and by what percentage per month? Justify your answer.

Answer 1

The price of fuel A decreases by 2 % each month.

Explanation:

We are given a function for the price of fuel which depends on the number of months.

f(x) = 2.15
`* (0.98)^(x)`

In the month 0, the price of the fuel is 2.15 and by the next month the price is 0.98 times the price of previous month.Hence the price of the fuel A decreases.

The initial price = 2.15

In the next month it reduces to 2.15
`*` 0.98 = 2.10

This means that the price becomes 0.98 times of the previous month and hence each month the price decreases by 2%.