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Re: At the beginning of each year, the price of item X is 10 percent highe [#permalink]
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Bunuel wrote:
At the beginning of each year, the price of item X is 10 percent higher than its price at the beginning of the previous year. During three consecutive years, if the price of item X is $8 at the beginning of the first year, what is its price at the beginning of the third year?

A. $8.80
B. $9.60
C. $9.68
D. $10.00
E. $16.00

PS21150


APPROACH #1
Time : Price
Beginning of first year : $8
Beginning of second year : $8 + (10% of $8) = $8 + ($0.80) = $8.80
Beginning of 3rd year: $8.80 + (10% of $8.80) = $8.80 + $0.88 = 9.68
Answer: C

APPROACH #2
Key concept: Increasing a value by 10% is the same as multiplying that value by 1.10
We get:
Beginning of first year : $8
Beginning of second year : ($8)(1.10)
Beginning of 3rd year: ($8)(1.10)(1.10) = ($8)(1.21) = $9.68
Answer: C

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Re: At the beginning of each year, the price of item X is 10 percent highe [#permalink]
Bunuel wrote:
At the beginning of each year, the price of item X is 10 percent higher than its price at the beginning of the previous year. During three consecutive years, if the price of item X is $8 at the beginning of the first year, what is its price at the beginning of the third year?

A. $8.80
B. $9.60
C. $9.68
D. $10.00
E. $16.00


PS21150

Net Increase is \(10 + 10 + \frac{10*10}{100} = 21\)

Hence, Value of the item after 3rd year is \(8*\frac{121}{100} = 9.68\), Answer must be (C)
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Re: At the beginning of each year, the price of item X is 10 percent highe [#permalink]
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Re: At the beginning of each year, the price of item X is 10 percent highe [#permalink]
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