Question

directions: use this information to answer parts a, b, c, d, e, and f.
victor is choosing between the two savings plans shown in the the table.

	initial amount	interest rate
plan 2	$20,000	5%

part a
identify the growth rate and growth factor for each savings plan.
drag the correct number or expression into the boxes.

show hints

plan 1 growth rate: box

plan 1 growth factor: box

plan 2 growth rate: box

plan 2 growth factor: box

Explanation:

Step1: Recall growth rate and factor

For exponential growth, growth rate \( r \) is the percentage rate (in decimal), and growth factor \( b = 1 + r \).

Step2: Plan 1 growth rate

Plan 1 interest rate is 4% = \( 0.04 \), so growth rate is \( 0.04 \) (or 4%).

Step3: Plan 1 growth factor

Using \( b = 1 + r \), \( r = 0.04 \), so \( b = 1 + 0.04 = 1.04 \).

Step4: Plan 2 growth rate

Plan 2 interest rate is 5% = \( 0.05 \), so growth rate is \( 0.05 \) (or 5%).

Step5: Plan 2 growth factor

Using \( b = 1 + r \), \( r = 0.05 \), so \( b = 1 + 0.05 = 1.05 \).

Answer:

Plan 1 growth rate: \( 0.04 \) (or 4%)
Plan 1 growth factor: \( 1.04 \)
Plan 2 growth rate: \( 0.05 \) (or 5%)
Plan 2 growth factor: \( 1.05 \)