Question

If the market for beer in Washington, DC in 2017 was 2,000,000 gallons and that had increased to 2,100,000 gallons in 2018, what would the size of this market be in 2019 (assume: constant market growth rate)?

Answer 1

The projected market size for beer in Washington, DC in 2019 is calculated by applying a 5% growth rate, determined from growth between 2017 and 2018, to the 2018 market size. The result would be 2,205,000 gallons.

Step-by-step explanation:

The question involves calculating the projected size of the beer market in 2019 based on the constant market growth rate from 2017 to 2018 in Washington, DC. To determine this, we calculate the growth rate from 2017 to 2018. The market grew from 2,000,000 gallons to 2,100,000 gallons, which is an increase of 100,000 gallons. To find the growth rate, we divide the increase by the original amount and multiply by 100 to get a percentage:

Growth rate = (Increase / Original amount) × 100 = (100,000 / 2,000,000) × 100 = 5%

Now, we apply this 5% growth rate to the 2018 number to find the 2019 market size:

2019 Market size = 2018 Market size × (1 + Growth rate) = 2,100,000 × 1.05 = 2,205,000 gallons

Therefore, the projected market size for beer in Washington, DC in 2019 would be 2,205,000 gallons assuming a constant growth rate.