# Problem 929

During the worst periods of hyperinflation in a certain country, the price of food increased at a rate of 25% per month. State whether this increase was linear or exponential. If your food bill was 100 in one month during this period, what was it three months later?

Solution:-

Linear growth occurs when a quantity grows by the same absolute amount in each unit of time.

Exponential growth occurs when a quantity grows by the same relative amount, that is, by the same percentage in each unit of time.

The monthly food bill increase by 25% in each of the three months. After 1 month the amount of the increase in monthly food cost can be found by multiplying 25% original monthly food cost.

0.25 * 100 = 25.00

Add to find that the monthly food bill after 1 month was 125.00

100+20.00 = 125.00

In the next month the food bill again increased by 25%. After 23 months the amount of the increase can be found by multiplying 25% by the food bill after 1 month.

0.25*125.00 = 31.25

Add to find that the monthly food bill after 2 months was 156.25.

125.00 + 31.25 = 156.25

After 3 months the monthly food bill rose by another 25%. The amount of the increase can be found by multiplying 25% by the food after 2 months.

0.25*156.25 = 39.06

Add to find the monthly food bill after 3 monthsÂ  was 195.31

156.25+39.06 = 195.31

Round to the nearest dollar.

The monthly food after 3 months was 195.

## One thought on “Problem 929”

1. during the worst periods of hyperinflation in a certain country, the price of food increased at a rate of 25% er month. State whether this increase was linear or exponential. If your food bill was \$160 in one month during this period, what was it three months later?