Samantha finds a bank, Star Bank, which offers a CD account with a 2% interest rate every month. Star Bank’s interest is not compounded. The interest is

Question

based on the original amount of deposit. Remember that Samantha has $500 to start the account. She will not withdraw or deposit more money in the account for 2 years.

5. Fill in the table showing the amount of money in the Star Bank CD account over 4 months.

Months 0 1 2 3 4
Amount in CD account $500.00

6. Is the relation a linear function? If so, state the rate of change and write the equation of the relation, where x is the number of months and y is the amount in the account. If not, explain why not.

Answer 1

since the interest is not compounded and only based on the original deposit, she receives monthly interest of:

$500 * 0.02 = $10

mo-0: $500
mo-1: $510
mo-2: $520
mo-3: $530
mo-4: $540

Yes - linear function, since the rate of change is constant.