If x represents the number of years, we have to determine the two values of y in consecutive terms to determine if the value of y increases or decreases after a year.
So, if x=1,
`y=0.35(2.3)^1 = 0.35*2.3=0.805`
And if x=2,
Since the value of y increases after a year, then it is the percent increase that we have to solve.
To do so, use the formula,
`% Increase = (Amount of Increase)/(Origi n al Amount)*100 `
`% Increase=(1.8515-0.805)/0.805 * 100=1.0465/0.805*100=1.3*100`
Hence, the annual percent increase is 130%.