Question

A new savings account is opened with 400 and gains 3% every year.what is the exponential function?

Answer 1

Exponential function is:

y = 100 (1.03)ˣ

Explanation:

We know that the exponential growth function is of the form

y = a (1 + r)ˣ

Here:

a = initial value

r = growth rate

x = number of time intervals that have passed

Given that A new savings account is opened with 400. Thus,

a = 400

Given that a new saving account gains 3% every year.

r = 3% = 0.03

now substituting a = 400 and r = 0.03 in the function

y = a (1 + r)ˣ

y = 100 (1 + 0.03)ˣ

y = 100 (1.03)ˣ

Therefore, exponential function is:

y = 100 (1.03)ˣ

Please note that the growth factor i.e. 1.03 is greater than 1, so the exponential function represents exponential growth.