Tim owns shares in a mutual fund. His investment was worth $4,200 when he first bought the shares. One year later, his shares were worth $4,410.
Let t represent the number of years since Tim first bought the shares. Assuming the value has increased exponentially, which expression best models the value of Tim's shares over time?
a) 4,410(1.05)^t
b) 4,200(0.05)^t
c) 4,200 ( 1.05) ^t
d) 4,410 (0.05t)
If the value of Tim's shares continues to increase at the same rate, what will they be worth 20years after he bought them?
Round your answer to the nearest whole number.
a) 4,410(1.05)^t
To find the value of Tim's shares 20 years after he bought them, we can substitute t = 20 into the expression:
4,410(1.05)^20 ≈ 10,986
Therefore, Tim's shares will be worth approximately $10,986 after 20 years.