Growth and decay, compound interest worksheet — GCSE Higher

1.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.

2.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.

3.A loan of £3000 has interest added at 2% each month, and then a fixed repayment of £200 is made. This is modelled by the recurrence B_{n+1} = 1.02B_n − 200, where B_n is the balance after n months and B_0 = 3000. Work out the balance after 2 months.

4.Maya buys a vintage car for £15000. Its value is expected to increase by 4% each year for 2 years. She then plans to sell the car and use £2000 of the money from the sale to buy a trailer. Work out how much money she will have left after selling the car and buying the trailer.

5.A car is bought for £12000. Its value falls by 15% in the first year and by 10% in each year after that. Work out the value of the car 3 years after it was bought.

6.A sequence is defined by the iterative rule x_{n+1} = 0.5x_n + 20, with x_0 = 0. By working out x_1, x_2 and x_3, find the value that the sequence is approaching.

7.A company had 8000 employees. The number of employees decreased by 5% in the first year, and then increased by 5% in the second year. Work out the number of employees at the end of the second year, to the nearest whole number.

8.A car is bought for £9000. Its value decreases by 8% each year. Work out its value after 2 years.

9.£5000 is invested in an account paying 4% compound interest each year. Work out the total interest earned after 3 years.

10.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.

11.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.

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.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.

14.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.

15.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.