Answer:
Option 3
The rate of change is -5%
Step-by-step explanation:
Given : An exponential function for compounding interest, [tex]A(x) = P(.95)^x[/tex]
To find : What is the rate of change?
Solution :
The general form of an exponential function is:
[tex]f(x) = a(1+r)^x[/tex]
Where, a is the initial amount,
(1+r) is the rate of change,
r is the growth or decay factor
We have given, [tex]A(x) = P(.95)^x[/tex]
Rate of change is
[tex]1+r=0.95[/tex]
[tex]r=0.95-1[/tex]
[tex]r=-0.05[/tex]
Convert to percent,
[tex]r=-0.05\times 100=-5\%[/tex]
Therefore, Option 3 is correct.
