Question

Please I really need help:

You have just graduated from college and purchased a car for $8000. Your credit limit is $12,000. Assume that you make no payments and purchase nothing more and that there are no other fees. The monthly interest rate is 14%. Write an exponential equation to determine how much you will owe (represented by y) after x months with no more purchases or payments.
a.) y=12,000(1.14)^x
b.) y=8,000(1.14)^x
c.) y=12,000(1.86)^x
d.) y=8,000(1.86)^x

Answer 1

Hi there

The answer is
b.) y=8,000(1.14)^x

Good luck!

Answer 2

The correct option is B.

Explanation:

It is given that price of car is $8000.

Credit limit is $12000.

The monthly interest rate is 14%.

The exponential growth function is defined as

`f(x)=a(1+r)^x`

Where, a is initial value, r is rate of interest per month and x is time in months.

Here the initial amount of loan is $8000 and monthly interest rate is 0.14.

`y=8000(1+0.14)^x`

`y=8000(1.14)^x`

The exponential equation to determine how much you will owe (represented by y) after x months with no more purchases or payments is
`y=8000(1.14)^x`

Therefore the correct option is B.