136k views
1 vote
The unique glass company reported sales of 24 million in 1995. The sales increased by 15% each year for the next 10 years. Calculate the company's sales in the year 2003.

a. $132.3 million
b. $348.68 million
c. $56.25 million
d. $79.98 million

1 Answer

4 votes

Final answer:

To find the company's sales in 2003 after a 15% annual growth from 1995, we use the compound growth formula A = P(1 + r)^n. The calculation gives us approximately $70.46 million, which is not one of the provided options. The question may contain an error, or you should review the question details again.

Step-by-step explanation:

To calculate the company’s sales in the year 2003, we need to apply the formula for compound growth, which is A = P(1 + r)^n, where:

  • A is the amount of money accumulated after n years, including interest.
  • P is the principal amount (the initial amount of money).
  • r is the annual interest rate (decimal).
  • n is the number of years the money is invested for.

The principal amount here is the initial sales, which is $24 million. The annual growth rate is 15% or 0.15 in decimal form, and the number of years, n, from 1995 to 2003 is 8 years.

Using the formula, we get:

A = $24 million × (1 + 0.15)^8

A = $24 million × (1.15)^8

A = $24 million × 2.93731 (using a calculator)

A = $70.45544 million

Therefore, the company's sales in the year 2003 were approximately $70.46 million, which is not one of the options provided. If this is a real-life scenario, an error might have occurred during the question setup. If it's a fictional scenario for the sake of homework or a test, please review the possible answer choices and question details again.

User Eatonphil
by
8.7k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.