Question

Which expression shows the value of a rare postage stamp, originally purchased for $5000, that has been increasing in value by 11% for 10 years?

F 5000(0.11)^10
G 5000(1.11)^10
H 5000(11)^10
J 5000(1.11)(10)

Answer 1

Explanation:

The correct expression is G: 5000(1.11)^10

This expression represents the value of the rare postage stamp after 10 years, given that its value has been increasing by 11% each year.

The value of the stamp after the first year would be 5000 * 1.11 = 5550.

The value of the stamp after the second year would be 5550 * 1.11 = 6160.5.

This process continues for 10 years, resulting in an overall increase in value of 5000 * 1.11^10 = 8261.3.

The other expressions are not correct because they do not accurately represent the value of the stamp after 10 years.

F: 5000(0.11)^10 represents the value of the stamp after 10 years, given that its value has been decreasing by 11% each year.

H: 5000(11)^10 represents the value of the stamp after 10 years, given that its value has increased by 1100% each year.

J: 5000(1.11)(10) represents the value of the stamp after 10 years, given that its value has increased by 11% for each of the 10 years. However, this expression does not take into account the compound interest that has accumulated over the 10 years.