Michael K. | Returning in SeptemberReturning in September

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Say that there is a very expensive dress that you want to purchase, but cannot afford. However, for whatever reason, the price of the dress is being reduced by 5% each week. So, if you wanted to buy the dress after one week, you would figure that the price is 95% of the original price. After 2 weeks the price is 95% of the previous weeks price. The decay factor is 0.95 because this is 95% as a decimal. Just think of how much you need to make up 100% and convert to a decimal. I'd be happy to explain more about how this relates to the exponential decay function y = a(1-b)^x, but I don't want to ramble on.

In the formula, (1-b) is the decay factor which in this problem is 1 - 0.05 = 0.95. a is the original amount and x is time. Again, I'm going off of the link above. You are probably using t for time. y is the new amount. As long as you have 3 pieces of information you can find the third. For instance, you might need to plug in y, x, and b to find a if it is a working backwards type of problem.

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