Question

the value of a particular investment follows a pattern of exponential growth. in the year 2000, you invested money in a money market account. the value of your investment t years after 2000 is given by the exponential growth model a=3500e0.067t. by what percentage is the account increasing each year?

Answer 1

The account increases at the rate of 6.7% a year.

Explanation:

An exponential growth model has the following format:

`A(t) = A(0)e^(rt)`

In which r is the decimal rate of growth of the model.

In this problem, we have that:

`A(t) = 3500e^(0.067t)`

0.067 = 6.7%

The account increases at the rate of 6.7% a year.