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Problem-Solving and Data Analysis / Two-variable data: Models and scatterplots Difficulty: Medium

Each year, the value of an investment increases by $0.49 percent sign$ of its value the previous year. Which of the following functions best models how the value of the investment changes over time?

Decreasing exponential

Decreasing linear

Increasing exponential

Increasing linear

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Explanation

Choice C is correct. Because the value of the investment increases each year, the function that best models how the value of the investment changes over time is an increasing function. It′s given that each year, the value of the investment increases by $0.49 percent sign$ of its value the previous year. Since the value of the investment changes by a fixed percentage each year, the function that best models how the value of the investment changes over time is an exponential function. Therefore, the function that best models how the value of the investment changes over time is an increasing exponential function.

Choice A is incorrect and may result from conceptual errors.

Choice B is incorrect and may result from conceptual errors.

Choice D is incorrect and may result from conceptual errors.