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Algebra

An investment grows according to the exponential equation y = 15,000 · 1.07x, where x is the number of years invested. Which of the following statements is true?

A. The investment will continue to grow at a rate of 7% per year compounded quarterly.
B. The investment will increase by $1050 per year.
C. The investment will more than double within 12 years.
D. The investment will triple within 15 years.

I got C is that correct or incorrect?

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David B.

  1. If it grows exponentially you mean
    15,000 * 1.07^x
    in other words compounding
    not 1.07 x

    In that case C is correct
    1.07^12 = 2.25

    A rough estimate to remember is that 7 percent compounded for ten years is about a doubling.

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    Damon

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