Question

Since 2004, the amount of money spent at restaurants in a certain country has increased at a rate of 6% each year. In 2004, about $490 billion was spent at restaurants. About how much will be spent at restaurants in 2014 if the trend continues?

A) About $726 billion
B) About $700 billion
C) About $660 billion
D) About $732 billion

Answer 1

By applying the formula for exponential growth, the estimated spending at restaurants in 2014 would be approximately $877.5 billion, which does not match any of the options provided in the multiple-choice options, indicating a potential error in the question or choices.

Step-by-step explanation:

To determine how much money will be spent at restaurants in 2014 if the spending trend continues with a 6% increase each year since 2004, we use the formula for exponential growth: final amount = initial amount * (1 + rate) ^ number of periods. The initial amount is $490 billion, the rate is 6% or 0.06, and the number of periods is 10 years (from 2004 to 2014).

Final amount = $490 billion * (1 + 0.06) ^ 10
= $490 billion * (1.06)^10
= $490 billion * 1.790847
= $877.51523 billion.

However, none of the options provided (A) About $726 billion, (B) About $700 billion, (C) About $660 billion, or (D) About $732 billion) match the calculated final amount, which may suggest a miscalculation or might be a typographical error in the options.