Question

hal is asked to write an exponential function to represent the value of a $10,000 investment decreasing at 2% annually. what multiplicative rate of change should hal use in his function? 0.98 1.98 0.02 1.02

Explanation:

Step1: Understand decay rate

For exponential decay, the formula is \( A = P(1 - r)^t \), where \( r \) is the rate of decrease (as a decimal). Here, \( r = 2\% = 0.02 \).

Step2: Calculate multiplicative rate

The multiplicative rate of change (base of the exponent) is \( 1 - r \). Substituting \( r = 0.02 \), we get \( 1 - 0.02 = 0.98 \).

Answer:

0.98