Question

Mr. Bert deposited $5,000 into an investment account 20 years ago with an annual interest rate of 3.75%.
Question 1
a) Give the exponential equation in the form f(x)=a( bx)
that represents this situation(2 points)

Answer 1

a = initial deposit = 5000, annual growth factor b = 1 + 0.0375 = 1.0375.
So the exponential model is

f(x) = 5000(1.0375)^x

where x is the number of years since the deposit.