Question

Chess club earnings are $40 per month and will increase at a rate of 2.5% each month. Which function describes this situation?

Answer 1

$\bf \qquad \textit{Amount for Exponential Growth}\\\\ A=I(1 + r)^t\qquad \begin{cases} A=\textit{accumulated amount}\\ I=\textit{initial amount}\to &40\\ r=rate\to 2.5\%\to \frac{2.5}{100}\to &0.025\\ t=\textit{elapsed time}\\ \end{cases} \\\\\\ A=40(1+0.025)^t\implies A=40(1.025)^t$