If a company earned $100,000 in 1980 and $400,000 in 2010, what was its average rate of change per year?

1 Answer
AJ Speller
Sep 28, 2014

The average rate of change is the slope of the secant line or just line that intersects 2 points on a graph.

If you think of the information as coordinates on a graph the points would be (1980,10000) and (2010,400000).

(x_1,y_1)->(1980,10000)
(x_2,y_2)->(2010,40000)

Average rate of change =

(y_2-y_1)/(x_2-x_1)=(400000-100000)/(2010-1980)=300000/30=30000/3=10000

The average rate of change per year is $10000.

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