Compounding problem- express the gdp of this country as a function of the number of years t after 2000. Word problem below
The gross domestic product of a certain country was $500 billion at the beginning of the year 2000 and increases at the rate of 2.3% per year. (think of this as a compouding problem)
express the gdp of this country as a function of the number of years t after 2000.
GDP at year 2000 = $500 Billion
The increase rate of GDP is 2.3% per year.
GDP at year 2001 `= ($500B)+($500B)xx2.3/100 = ($500B)xx1.023`
This is one year after 2000
GDP at year 2002 `= (($500B)xx1.023)xx1.023 = ($500B)xx1.023^2`
This is two years after 2000
If the year is t years after 2000 we can say the GDP is;
`GDP = ($500B)xx1.023^t`