Question

The amount of money in a saving account after t years is represented by the function f(t) = 650(1.027)^tWhat does the value 650 represent in this situation? The amount of money in the savings account increases by $650 each year. The amount of money in the savings account is 650 times the amount of the previous year.The amount of money in the savings account decreases by $650 each year. The initial amount in the account is $650.

Answer 1

The amount of money saved in a bank account is often represented by the equation:

`f(t)=P(1+r)^t`

Where P is the initial amount of money deposited in the account and r is the rate in decimal form.

In this case, your equation looks like this:

`f(t)=650(1.027)^t`

Comparing the general equation with the one that you have, we can notice that the 650 is not raised to t like the P in the above equation, thus P equals $650.

Then, the value 650 represents that the initial amount in the account is $650.​