PS- Percentages from OG 11th : PS Archive
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# PS- Percentages from OG 11th

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PS- Percentages from OG 11th [#permalink]

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19 Dec 2005, 18:48
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Hey guys, i need some help on the explanation og provided. Here goes:

Lucy invested \$10,000 three years ago. The first year the value increased by 10%, the second year it increased by 5%, the third year it decreased by 10%. What is the current amount?

OG says you can present the percentages as: 1.10, 1.05, and .90
How is that so? I got the problem wrong by calculating yearly values corresponding to their percentages. Please help!

Thanks,
DG
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19 Dec 2005, 18:57
100% = 1 (in decimal number system)

So if it increased by 10%, it means now the current value is value * 1.1 (1+0.1). And if it decrased by 10%, then the current value is value * 0.9 (1-0.1)

So:

Initial amt: 10,000
1st yr = 1.1 * 10,000 = 11,000
2nd yr = 1.05 * 11,000 = 11,550
3rd yr = 0.9 * 11,550 = 10,395
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