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Exercise 5.1 · Q3

Q.Using binomial theorem, indicate which of the following two numbers is larger: (1.01)1000000(1.01)^{1000000}, 1000010000.

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✓ Free question

Expanding (1+0.01)1000000(1+0.01)^{1000000} by the binomial theorem and keeping just the first two (positive) terms already exceeds 1000010000; every dropped term is positive, so the true value is even larger.

Step 1. Write (1.01)1000000=(1+0.01)1000000(1.01)^{1000000}=(1+0.01)^{1000000} and expand.

(1+0.01)1000000=1000000C0+1000000C1(0.01)+1000000C2(0.01)2+⋯(1+0.01)^{1000000} = {}^{1000000}C_0 + {}^{1000000}C_1(0.01) + {}^{1000000}C_2(0.01)^2+\cdots, and every term here is positive (since 0.01>00.01>0).

Step 2. Keep just the first two terms as a lower bound.

(1+0.01)1000000≥1+1000000(0.01)=1+10000=10001(1+0.01)^{1000000} \ge 1 + 1000000(0.01) = 1+10000 = 10001

(dropping the remaining, strictly positive, terms can only make the true sum bigger, never smaller).

Step 3. Compare. 10001>1000010001 > 10000, so

(1.01)1000000≥10001>10000(1.01)^{1000000} \ge 10001 > 10000.

✓Final answer

(1.01)1000000>10000(1.01)^{1000000} > 10000 — it is the larger of the two numbers.

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