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The total number of industries in a particular portion of the country is approximately 1,600. If the government has decided to increase the number of industries in the area by 20% every year;

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Question

The total number of industries in a particular portion of the country is approximately 1,600. If the government has decided to increase the number of industries in the area by 20% every year; find the approximate number of industries after 2 years.

Sum
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Solution

Number of industries after 2 years
= Original number of industries `(1 + r/100)^n`
= 1,600`(1 + 20/100)^n`
= 2,304

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Concept of Compound Interest - Compound Interest as a Repeated Simple Interest Computation with a Growing Principal
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