HKD1710 wrote:

Starting in 1991, the budget deficit of a certain country was expected to double every year for the next 10 years. At that rate of increase, what will the deficit be at the end of the 10-year period?

(1) The budget deficit of the country in 1991 was $300,000.

(2) The projected increase in the deficit from 1994 to 1995 is $2,400,000.

Although there are many a methods for solving above

My take...

C=P(1+r/100)^t--(a)

Rate =100% (since the deficit doubles /year)

t=10yrs

(1) P=300000

we can calculate C from (a)

thus deficit= C+P

suff..

(2) P in 1994 = 2400000

thus P (1993)= 1200000(since amount/deficit doubles in preceding year)

P(1992) =600000

P(1991)=300000------(same info as in option 1)

suff

Ans D