revenue growth help

hi everyone, i need some serious help with this question!

i am in the middle of studying for a manager position offered by my employers
and need to take this manager lap test, i have been looking at this one question all day, now i have 18 questions and 20 minutes to do them without calculator, please help solve if u can

Q: revenue is expected to increase steadily at 15% annually, if revenue at the end of 2000 was 2.3 million what should the approximate revenue be at the end of 2004.


i answered the question but it took me 10 minutes, this will not work i need to be able to do this quickly

thanks for your help

Quote:

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Originally Posted by superpieboy

hi everyone, i need some serious help with this question!

i am in the middle of studying for a manager position offered by my employers
and need to take this manager lap test, i have been looking at this one question all day, now i have 18 questions and 20 minutes to do them without calculator, please help solve if u can

Q: revenue is expected to increase steadily at 15% annually, if revenue at the end of 2000 was 2.3 million what should the approximate revenue be at the end of 2004.


i answered the question but it took me 10 minutes, this will not work i need to be able to do this quickly

thanks for your help

---

After 4 years at 15% growth is R=2.3 (1.15)^4 the first approximation to
this is R~= 2.3 (1 + 4*0.15) ~= 3.7 million.

A more accurate estimate will take about as long as calculating this exactly.

(exact answer R~=4.02 million)

RonL

thanks cap'n blk

the answere is 4.02 on the test!!!!
great job

i will have to use that long way that u stated, also what could i look up on the internet for info or help on question like this?

what is the formula for getting the 4.02 million?

thx
jeff

Quote:

---

Originally Posted by superpieboy

thanks cap'n blk

the answere is 4.02 on the test!!!!
great job

i will have to use that long way that u stated, also what could i look up on the internet for info or help on question like this?

what is the formula for getting the 4.02 million?

thx
jeff

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CaptainBlack used what is often refered to as the "compounding interest" formula.

A = P(1 + r/n)^(nt)

Where
P = the principle amount of money (the initial amount of money): 2.3 mil
A = the amount of money earned: 4.02 mil
r = the interest rate: 15% or .15
n = the number of times the money is compounded in one year: 1
t = the number of years the money is compounded: 4

In your case, you may not need the equation with "n"s in it. You can simply use:

A = P(1 + r)^t

Just remember to write r in decimal form.

2,30
x 1.15
-----------------
1150
230
230
----------------
2,645,000
2,300,000
----------------
4,945,000

how does this look?
i get the wrong answere:confused:

jeff

this all left hand justified hope you get the poit