Question

PLEASE HELP! 20 POINTS!!

(c) Analysts predict the share price of a new company, Hydrate Energy, to be modelled by the equation
V = 2.95 + 2log10 (10t + 1) where t is the number of years and V is the value in dollars.
(i) How much do they expect the share price to increase in value between the first and third years?
Show working

Answer 1

The share price increased by $40

Explanation:

In the first year: (t = 1)

=> V =
`2.95 +2log10(10(1)+1)`

=>
`V = 2.95 + 2 (10+1)\\V = 2.95+2(11)`

=>
`V = 2.95+22`

=> V = $ 24.95

In the 3rd Year: (t = 3)

=>
`V = 2.95 + 2log10(10(3)+1)`

=>
`V = 2.95+ 2(30+1)`

=>
`V = 2.95+2(31)`

=> V = 2.95 + 62

=> V = $64.95

The Share Price increased by:

=> $64.95-$24.95

=> $40

The share price increased by $40