SOLUTION: Abby started with $12,000 in her savings account. The banks interest is 5% annual percentage rate compounded monthly. What is the model as an exponential growth function?

Question 1207164: Abby started with $12,000 in her savings account. The banks interest is 5% annual percentage rate compounded monthly. What is the model as an exponential growth function?
Answer by Shin123(626) (Show Source): You can put this solution on YOUR website!
Recall the compound interest formula, , where is the principal, is the interest rate (as a decimal), is the amount of years, and is how many times a year it is compounded. We know all of these variables except for , so it will be a function in terms of time. Plugging everything in, we get To simplify it further and have the exponent be just , we can rewrite the function as . The inner expression is , and we can evaluate it to get the function as (rounding the inner constant to 7 decimal places. If you want, you can calculate the expression to more decimal places, or just keep it as , depending on which one is better for you.
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