Question

Given the following exponential function, identify whether the change represents growth or decay, and determine the percentage rate of increase or decrease. y = 2000(1.04)^x

Answer 1

We have that the formula for exponential decay is the following:

`y=a(1-r)^x`

where r is the decay rate. In this case, we have the following:

`y=2000(1.04)^x`

notice that since 1.04 shows the change of the origina amount, we have that it increases 104% (since 104% = 1.04).

then the change represents growth, with a rate of increase of 4%