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Hello everyone!

I need help with the following Math problem:

"An investment increases in value by 8% in its first year. It decreases in value by 8% in the second year. If the initial value of the investment is $1000, what is the value of the investment after the two years?"

I would really appreciate a full explanation of the problem!
Thank you!

1 Answer

4 votes
After 1 year it is worth 108% of its original value
108% = 1.08
so 1.08 x 1000 = $1080

After 2nd year it is worth 92% of that $1080
92% = 0.92
so 0.92 x 1080 = $993.60
User Florian Mielke
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