Question

The balance owed on your credit card triples from $700 to $2100 in 12 months. If the balance is growing linearly then it would take 45.4 months to reach $6000. If, on the other hand, the balance is growing exponentially, f(x)=700(1+0.096)x where x represents the number of months, what would the balance be after 45.4 months? Round your answer to the nearest cent.

Answer 1

Answer:

If the balance is growing exponentially the balance after 45.4 months will be $44,925.94.

Step-by-step explanation:

The exponential growth equation is:

$f(x)=700(1+0.096)^{x}$

Compute the value of f (x) for x = 45.4 as follows:

$f(x)=700(1+0.096)^{x}$

       $=700(1+0.096)^{45.4}\\\\=700\times (1.096)^{45.4}\\\\=700\times 64.1799181\\\\=44925.94267\\\\\approx 44925.94$

Thus, if the balance is growing exponentially the balance after 45.4 months will be $44,925.94.