Question

Daniel deposits $300 into an account that earns 16% interest annually. Which equation can be used to model his account balance, y, after x years?

Answer 1

`y=300(1+0.16)^x`

Explanation:

This account can be modeled using the compound interest formula.

the compound interest formula is expressed as

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

Where

A =final amount = y

P=initial principal balance = $300

r=interest rate = 16%= 0.16

t=number of time periods elapsed= x

Hence the equation to model his account balance/ final amount A (y) after time (x) years is

`y=300(1+0.16)^x`