### Home > A2C > Chapter 7 > Lesson 7.1.1 > Problem 7-15

7-15.

The cost of food has been increasing by 4% per year for many years. To find the cost of an item 15 years ago, Heather said, “*Take the current price and divide it by* (1.04)^{15}.” Her friend Elissa said, “*No, you should take the current price and multiply it by* (0.96)^{15} *!*”

Explain who is correct and why. Homework Help ✎

Since the situation describes an increase, the multiplier must be 1.04. In this situation, *x* will represent cost.

What will *x* be 15 years in the past?

Heather is correct, because a 4% decrease does not cancel out a 4% increase.