Solution: 









1. 
Present Value 
Years 
Interest Rate 
Future Value 

$600 
10.94 
8% 
$1,393 

850 
8.90 
12 
2,330 

18,800 
17.96 
18 
367,247 

21,900 
21.84 
14 
382,983 





Working Notes: 









Future value = Present Value (1+r)^t 








For 




$600 
10.94 
8% 
$1,393 






Future value = Present Value (1+r)^t 



1,393 = 600 (1+0.08)^t 









(1.08)^t = (1,393/600) 














taking log on both side 









(1.08)^t =2.32166 




Log(1.08)^t = Log(2.32166) 




t x Log(1.08) = Log(2.32166) 









t=Log(2.32166)/Log(1.08) 




t= 0.3657986/0.0334237 




t= 10.94 









For 




850 
8.90 
12 
2,330 






Future value = Present Value (1+r)^t 



2,330 = 850(1+0.12)^t 









(1.12)^t = (2,330/850) 














taking log on both side 









(1.12)^t =2.741176 




Log(1.12)^t = Log(2.741176) 




t x Log(1.12) = Log(2.741176) 









t=Log(2.741176)/Log(1.12) 




t= 0.4379369/0.0492180 




t= 8.8979 




t=8.90 









For 




18,800 
17.96 
18 
367,247 






Future value = Present Value (1+r)^t 



367,247 = 18,800(1+0.18)^t 









(1.18)^t = (367,247/18,800) 














taking log on both side 









(1.18)^t =19.53441489 




Log(1.18)^t = Log(19.53441489) 




t x Log(1.18) = Log(19.53441489) 









t=Log(19.53441489)/Log(1.18) 




t= 1.2908004074/0.071882007 




t= 17.95721156 




t=17.96 









For 




21,900 
21.84 
14 
382,983 






Future value = Present Value (1+r)^t 



382,983 = 21,900(1+0.14)^t 









(1.14)^t = (382,983/21,900) 














taking log on both side 









(1.14)^t =17.48780822 




Log(1.14)^t = Log(17.48780822) 




t x Log(1.14) = Log(17.48780822) 









t=Log(17.48780822)/Log(1.14) 




t= 1.2427353819/0.05690485 




t= 21.83883064273 




t=21.84 








Notes: 
Exact value of t is calculation showing t value having more than two decimal , as per demand of question t value is round off to two decimal 







Log value is calculate from online calculator 












2. 
Annual increase in selling price = 2.97% 







Working Notes 









Using formula 









Future value = Present Value (1+r)^t 








$280,400=$197,300(1+r)^12 














(1+r)^12 = 280,400/197,300 




(1+r)^12 = 1.421186011 









(1+r) = (1.421186011)^(1/12) 









(1+r) = 1.029724178 









r=1.029724178 – 1 




r=0.029724178 




r=2.97% 








Exact value of r is calculation showing r value having more than two decimal , as per demand of question r value is round off to two decimal 