Question

Consider the function y = (0.92)". If t is measured in years, what is thepercent change in y every year?

Answer 1

Given:

`y=0.92^t`

To calculate percentage change,

At first year t=1,

`\begin{gathered} y_1=0.92^1 \\ y_1=0.92 \end{gathered}`

for second year t=2,

`\begin{gathered} y_2=0.92^2 \\ y_2=0.8464 \end{gathered}`

The percentage change is given by,

`\begin{gathered} P=(y_2-y_1)/(y_1)*100 \\ =(0.8464-0.92)/(0.92)*100 \\ =-8 \end{gathered}`

The percentage change in y is -8%