Question

In the year 2008, a company made $4.9 million in profit. For each consecutive year after that, their profit increased by 12%. How much would the company's profit be in the year 2011, to the nearest tenth of a million dollars?

Answer 1

The profit of the company in 2011 is $ 6.89 million

Explanation:

Given data

In 2008 profit made by the company (P) = $ 4.9 million

Increase in profit of the company R = 12 % yearly

Now the profit of the company in 2011 is given by

`P_(1) = P (1 + (R)/(100)) ^(T)`

Here P = $ 4.9 million

R = 12 % = 0.12

T = 3 years

Thus the profit of the company in 2011 is

`P_(1) = 4.9 (1 + (12)/(100)) ^(3)`

`P_(1)` = 6.89 million dollars

Therefore the profit of the company in 2011 is $ 6.89 million