Question

Sam owns a chain of fast food restaurants that operated 200 stores in 1999. If the rate of increase is 8% annually, how many stores does the restaurant operate in 2007?

Answer 1

370 stores

Explanation:

Given data

initial number of stores P= 200

r= 8%

t= 1999-2007= 8 years

Let us apply the compound interest expression to find the final amount of stores

A= P(1+r)^t

A= 200(1+0.08)^8

A= 200(1.08)^8

A= 200*1.85

A=370

Hence the number of stores in 2007 is 370 stores