Answer:
C. Exponential growth
Explanation:
You want to know how to describe the relation that represents a 10% increase per year.
Function
The problem statement tells you the number of guests "increased by approximately 10% each year". The nature of the function depends on what "10%" refers to.
If the amount of increase is constant year after year (10% of the original number of guests), then the relationship is linear.
If the amount of increase is 10% of the previous year's number, so the amount increases each year, then the relationship is exponential.
Growth and decay
When the number increases year on year, the number is said to be growing. If the relationship is exponential, it is described as exponential growth.
If the number were decreasing by 10% per year, it would be an exponential decay relationship.
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Additional comment
Whenever you're dealing with percentages, you always need to understand what is being used as the base amount. (What does 100% represent?)
Usually, a percentage increase or decrease is referring to the current value. Not always.
Sometimes a change from 10% to 6% is referred to as a 4% decrease, and sometimes it is referred to as a 40% decrease. It depends on who is selling what to whom.