1. The problem asks for the growth factor when water usage increases by 3% per year. 2. The growth factor in exponential growth is calculated as $1 + r$, where $r$ is the growth rate expressed as a decimal. 3. Since the increase is 3%, convert this percentage to a decimal: $r = \frac{3}{100} = 0.03$. 4. Apply the formula for growth factor: $$\text{growth factor} = 1 + 0.03 = 1.03$$ 5. This means each year, the water usage is multiplied by 1.03, representing a 3% increase. 6. Among the options given: - a. 3 per year (incorrect, this is not a factor but a percentage) - b. 0.03 per year (incorrect, this is the decimal rate, not the growth factor) - c. 1.03 per year (correct, this is the growth factor) - d. 103 per year (incorrect, this is not related to the growth factor) Final answer: c. 1.03 per year