Growth and decay, compound interest worksheet — GCSE Higher

1.A vehicle is worth £18000. Its value decreases by 15% each year. Using the recurrence V_{n+1} = 0.85V_n, with V_0 = 18000, find the first whole number of years after which the vehicle's value drops below £10000.

2.A trust fund contains £8000. Each year, 5% interest is added, and then £600 is paid out to a charity. Work out the amount remaining in the fund after 2 years.

3.A laptop costs £800 when new. Its value decreases by 25% of its value at the start of each year. Work out how much value the laptop loses in the second year.

4.A machine is bought for £8500. Its value depreciates by 6% each year. Work out the value of the machine after 3 years, to the nearest pound.

5.A savings account starts with £500. Each year, 4% interest is added, and then £30 is withdrawn from the account. Which recurrence correctly models the balance, £S_n, after n years, with S_0 = 500?

6.There are 2500 electric cars registered in a town. The number is predicted to increase by 6% each year. Work out the predicted number of electric cars after 3 years, to the nearest whole number.

7.Before a charity campaign, donations were £6400 per month. Donations grew by 8% in the first year after the campaign, and then fell by 3% in the second year as interest faded. Work out the amount donated per month at the end of the second year, to the nearest pound.

8.The concentration of a pollutant in a lake, in arbitrary units, follows the recurrence C_{n+1} = 0.75C_n + 40, with C_0 = 500: each week, 25% of the pollutant breaks down naturally, and then a further 40 units enter the lake from run-off. An ecologist classifies the lake as safe once C_n first drops below 300. Find the first whole number of weeks after which the lake is safe.

9.A patient is given a dose of 200 mg of a drug. Each hour, 30% of the drug remaining in the bloodstream is eliminated, and then a further dose of 50 mg is given. Using the recurrence D_{n+1} = 0.7D_n + 50, with D_0 = 200, work out the amount of drug in the bloodstream after 2 hours.

10.A sequence is defined by the iterative rule x_{n+1} = 0.8x_n + 50, with x_0 = 200. Work out x_2, the value of the sequence after two iterations.

11.The value of a rare coin increases by 12% each year. The coin is currently worth £270. Work out the value of the coin after 2 years, giving your answer to the nearest penny.

12.A savings account pays 3.5% compound interest each year. Bilal invests £1200. Work out how much interest, in total, he earns after 2 years, to the nearest penny.

13.Aisha invests £3200 in Account A, which pays 5% compound interest each year. She also invests £3200 in Account B, which pays 3% simple interest each year. Work out how much more Account A is worth than Account B after 2 years.

14.A population of fish in a lake is modelled by the recurrence P_{n+1} = 1.1P_n − 30, where P_n is the population after n years, 30 fish are removed by fishing each year, and P_0 = 400. After how many complete years does the population first exceed 460?

15.A process is modelled by the recurrence P_{n+1} = 0.6P_n + 40. As n increases, P_n approaches a long-run value L, which satisfies L = 0.6L + 40. Solve this equation to find L.