Leroy received a stamp for his collection as a gift. When he received the stamp, it was worth 14.50. The value of the stamp increases by 2% each year. Write an equation for the value of the stamp V after t years.

Solution

L eroy rece i v e d a s t am p f or hi s co ll ec t i o n a s a g i f t . Wh e n h e rece i v e d t h e s t am p, i t w a s w or t h 14.50. T h e v a l u e o f t h e s t am p in cre a ses b y 2% e a c h ye a r . W r i t e an e q u a t i o n f or t h e v a l u e o f t h e s t am p V a f t er t ye a rs .

Amount before addition : 14.21568 \dots

Solution steps

Translate the problem into an equation:

14.5 = x + 0.02 x

14.5 = x + 0.02 x : x = \frac{725}{51}

\frac{725}{51} = 14.21568 \dots

Amount before addition : 14.21568 \dots