Answer:
The cost per month of replacement insurance of laptop is $20.94
Step-by-step explanation:
Given as :
The initial cost of replacement insurance of laptop = $19 per months
The rate of increase = r = 5% yearly
The time period = 2 years
Let The cost per month in 2 years = $x
Now, According to question
The final insurance cost = The initial insurance cost × [tex](1+\dfrac{\textrm rate}{100})^{\textrm time}[/tex]
Or, The final insurance cost = $19 × [tex](1+\dfrac{\textrm r}{100})^{\textrm t}[/tex]
Or, The final insurance cost = $19 × [tex](1+\dfrac{\textrm r}{100})^{\textrm t}[/tex]
Or, The final insurance cost = $19 × [tex](1+\dfrac{\textrm 5}{100})^{\textrm 2}[/tex]
Or, x = $19 × (1.05)²
or, x = $19 × 1.1025
∴ x = $20.94
So, The cost per month in two years = x = $20.94
Hence The cost per month of replacement insurance of laptop is $20.94 Answer
