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R16

Set up, solve and interpret the answers in growth and decay problems, including compound interest and work with general iterative processes

Growth and decay

Worked answers, methods and verified real exam appearances for R16 on Edexcel GCSE Maths 1MA1.

Definition

Specification R16: set up, solve and interpret the answers in growth and decay problems, including compound interest, and work with general iterative processes.

Explanation

  • Growth or decay by a fixed percentage each period is repeated multiplication: the multiplier is 1±r1001\pm\dfrac{r}{100}, and after nn periods the amount is initial×(multiplier)n\text{initial}\times(\text{multiplier})^n.
  • Compound interest earns interest on the interest, so the multipliers are applied in turn and the rates are never added; simple interest, by contrast, is the same amount every year and scores at most one mark when compound was asked for.
  • With different rates in different years, multiply by each year's multiplier, 7000×1.03×1.0157000\times1.03\times1.015.
  • To find the rate or the number of years, test powers of the multiplier or use the given data to solve.
  • Higher tier: an iterative formula such as Pn+1=1.2Pn−50P_{n+1}=1.2P_n-50 makes each term from the previous one, so evaluate the terms in order, stopping at the term asked for, and keep full precision until the end.

Worked example

1

Priya invests £5200\pounds5200 for 22 years in an account paying compound interest. In the first year the rate of interest is 2.5%2.5\%. In the second year the rate of interest is 4%4\%. Work out the value of Priya's investment at the end of 22 years.

(3)

(Total for Question 1 is 3 marks)

Working

  1. 1.The multiplier for the first year is 1.0251.025: 5200×1.025=53305200\times1.025=5330.
  2. 2.The multiplier for the second year is 1.041.04, applied to the new balance: 5330×1.045330\times1.04.
  3. 3.5330×1.04=5543.25330\times1.04=5543.2, so the investment is worth £5543.20\pounds5543.20.

Answer: £5543.20\pounds5543.20

Mark scheme

Mark scheme for question 1
QuestionAnswerMarkAdditional guidance
1for a correct first step, eg 5200×1.0255200\times1.025 (= 5330) or 5200×2.5÷1005200\times2.5\div100 (= 130), or for the multiplier for both years, eg 1.025×1.041.025\times1.04 (= 1.066)M1oe
for a compound method, eg 5200×1.025×1.045200\times1.025\times1.04 or “5330” ×1.04\times1.04M1oe
for 5543.205543.20A1cao; accept 5543.2

Common mistakes

  • Don't calculate repeated percentage change as simple change from the original amount.
  • Don't use 1.151.15 for a 15%15\% decay instead of 0.850.85.
  • Don't round each intermediate iteration and change the first term meeting the condition.

Mark-scheme wording to use

  • “for a correct first step eg working out increase for one year … or find the multiplier for both years” — Pearson 1MA1, November 2022 Paper 2H, Q6
  • “M1 works out decrease for one year eg 679 × 4 ÷ 100 (= 27.16) oe or 679 × (100 − 4) ÷ 100 (= 651.84) oe … M1 for compound method, eg 679 × “0.96”^t, t ≥ 2 … A1 for 600.71 or 600.72 or 600.73 or 600.74” — Pearson 1MA1, June 2022 Paper 2H, Q6
  • “P1 uses formula eg 1.2 × 200 – 50 (= 190) P1 for complete process, eg May: 1.2 × “190” – 50 (= 178) and June: 1.2 × “178” – 50 (= 163.6) A1 for 163 or 164” — Pearson 1MA1, November 2019 Paper 2H, Q22(a)

What the examiner wants

Multipliers, not added percentages. The November 2024 Paper 3H report says the most successful solutions used percentage multipliers, while common errors were adding the percentages together and raising that multiplier to the power 33, working with simple interest for a maximum of one mark, and using 1.0061.006 instead of 1.061.06.

Exam tip

For “first time” questions, show the last value that fails and the next value that meets the condition.

Worked practice

Q1
Tier 1 · Easy

1

£600 is invested at 4%4\% compound interest per year. Work out the value after 22 years.

(2)

(Total for Question 1 is 2 marks)

Mark scheme

Mark scheme for question 1
QuestionAnswerMarkMark scheme
1
  • £648.96
2Use multiplier 1.041.04 twice: £600×1.042=£648.96600\times1.04^2=£648.96.
Q2
Tier 2 · Standard

2

A culture initially contains 960960 cells and decreases by 15%15\% each hour. Calculate the expected number after 33 hours.

(3)

(Total for Question 2 is 3 marks)

Mark scheme

Mark scheme for question 2
QuestionAnswerMarkMark scheme
2
  • About 590590 cells
  • Unrounded model value =589.56=589.56
3The decay multiplier is 0.850.85. After 33 hours the model gives 960×0.853=589.56960\times0.85^3=589.56, which is about 590590 whole cells.
Q3
Tier 1 · Easy

3

Write down the multiplier for an increase of 6.5%6.5\%.

(1)

(Total for Question 3 is 1 mark)

Mark scheme

Mark scheme for question 3
QuestionAnswerMarkMark scheme
3
  • 1.0651.065
1An increase of 6.5%6.5\% uses multiplier 1+0.065=1.0651+0.065=1.065.
Q4
Tier 2 · Standard

4

An account pays 5%5\% compound interest each year, and the interest earned in the second year is £31.50. Work out the amount originally invested.

(3)

(Total for Question 4 is 3 marks)

Mark scheme

Mark scheme for question 4
QuestionAnswerMarkMark scheme
4
  • £600
3The balance before the second-year interest was added is £31.50÷0.05=£63031.50\div0.05=£630. This is 105%105\% of the original amount, so the original investment was £630÷1.05=£600630\div1.05=£600.
Q5
Tier 3 · Hard

5

A forestry model starts with 40964096 young trees. Model S increases the number each year by 12.5%12.5\% of the original number. Model C increases the previous year's number by 12.5%12.5\% each year. Work out how many more young trees Model C predicts than Model S after 33 years.

(3)

(Total for Question 5 is 3 marks)

Mark scheme

Mark scheme for question 5
QuestionAnswerMarkMark scheme
5
  • 200200 more young trees
3Model S adds 4096×0.125=5124096\times0.125=512 trees each year, so after 33 years it predicts 4096+3×512=56324096+3\times512=5632. Model C predicts 4096×1.1253=58324096\times1.125^3=5832. The difference is 5832−5632=2005832-5632=200 young trees.
Q6
Tier 2 · Standard

6

A warehouse starts with 64006400 filters. It dispatches 15%15\% of the current stock in the first week and 10%10\% of the remaining stock in the second week. Work out the number of filters left.

(3)

(Total for Question 6 is 3 marks)

Mark scheme

Mark scheme for question 6
QuestionAnswerMarkMark scheme
6
  • 48964896 filters
3After the first week, 6400×0.85=54406400\times0.85=5440 filters remain. After the second week, 5440×0.90=48965440\times0.90=4896 filters remain.
Q7
Tier 3 · Hard

7

£30003000 is invested. The value grows by 4%4\% in year one, then by 1.5%1.5\% in each of the following two years. Work out the overall percentage increase across the three years, giving the percentage correct to 11 decimal place.

(4)

(Total for Question 7 is 4 marks)

Mark scheme

Mark scheme for question 7
QuestionAnswerMarkMark scheme
7
  • 7.1%7.1\%
4The overall multiplier is 1.04×1.0152=1.04×1.030225=1.071434…1.04\times1.015^2=1.04\times1.030225=1.071434\ldots, so the value is multiplied by 1.0714…1.0714\ldots overall. The overall increase is 7.1434…%7.1434\ldots\%, which is 7.1%7.1\% correct to 11 decimal place. (Equivalently, £30003000 grows to £3214.303214.30, an increase of £214.30214.30, and 214.30÷3000=7.14…%214.30\div3000=7.14\ldots\%.)
Q8
Tier 3 · Hard

8

A ball is dropped from a height of 10 m10\,\text{m}. After each impact, its greatest rebound height is 72%72\% of the preceding greatest height. Work out the total vertical distance travelled from release until the ball hits the floor after its third rebound. Give the distance to the nearest centimetre.

(5)

(Total for Question 8 is 5 marks)

Mark scheme

Mark scheme for question 8
QuestionAnswerMarkMark scheme
8
  • 42.23 m42.23\,\text{m}
5The first three rebound heights are 10×0.72=7.210\times0.72=7.2, 7.2×0.72=5.1847.2\times0.72=5.184 and 5.184×0.72=3.732485.184\times0.72=3.73248 metres. Each rebound height is travelled upwards and downwards, so the total distance is 10+2(7.2+5.184+3.73248)=42.23296 m10+2(7.2+5.184+3.73248)=42.23296\,\text{m}. This rounds to 42.23 m42.23\,\text{m}.
Q9
Tier 3 · Hard

9

Higher tier: A tank initially contains 500500 litres. At the start of each week, 8080 litres are added. During that week, 20%20\% of the resulting amount is used. Let SnS_n be the amount left after nn weeks. Write an iterative formula for Sn+1S_{n+1} in terms of SnS_n, and work out the amount left after 44 weeks.

(5)

(Total for Question 9 is 5 marks)

Mark scheme

Mark scheme for question 9
QuestionAnswerMarkMark scheme
9
  • Sn+1=0.8(Sn+80)S_{n+1}=0.8(S_n+80), with S0=500S_0=500
  • 393.728393.728 litres
5Adding 8080 litres and then keeping 80%80\% gives Sn+1=0.8(Sn+80)S_{n+1}=0.8(S_n+80). Starting with S0=500S_0=500, the values are S1=464S_1=464, S2=435.2S_2=435.2, S3=412.16S_3=412.16 and S4=393.728S_4=393.728. Therefore 393.728393.728 litres remain after 44 weeks.

Verified exam appearances

SeriesPaperQuestionMarksCalculatorTierLinks
2019-063FQ253AllowedFoundationQPMS
2022-112HQ103AllowedHigherQPMS
2022-062HQ63AllowedHigherQPMS
2022-112HQ63AllowedHigherQPMS
2022-112HQ123AllowedHigherQPMS
2024-063HQ44AllowedHigherQPMS
2023-062HQ84AllowedHigherQPMS
2024-063HQ144AllowedHigherQPMS
2021-113HQ193AllowedHigherQPMS
2024-113FQ263AllowedFoundationQPMS
2019-112HQ133AllowedHigherQPMS
2019-063HQ23AllowedHigherQPMS
2019-112HQ224AllowedHigherQPMS
2024-113HQ126AllowedHigherQPMS
2022-112FQ233AllowedFoundationQPMS
2022-063HQ103AllowedHigherQPMS
2023-062FQ274AllowedFoundationQPMS
2023-111HQ164Non-calculatorHigherQPMS
2021-112HQ104AllowedHigherQPMS
2022-062FQ263AllowedFoundationQPMS
2023-112HQ32AllowedHigherQPMS
2022-063HQ204AllowedHigherQPMS
2024-063FQ254AllowedFoundationQPMS
2023-112FQ242AllowedFoundationQPMS

Other points in R Ratio, proportion and rates of change

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