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Exponential Growth: SAT Practice Test 2, Section 4, #37




This question is looking at exponential growth. Some hints as to how we know this is an exponential growth question include the following:


  • A mention of a percent increase or decrease every period

  • “Compounded” every certain amount of time

  • Variable (x, y, z, t, etc.) in the exponent


But the big giveaway is that the format of the given expression neatly matches the exponential growth formula.

Where

  • A represents your starting value,

  • r represents your growth per period

  • t represents the number of periods


Compare this to the following equation:

You can see that 1+r in the compound growth formula and x in the expression provided are in the same relative positions.


So they are equivalent.


We are also told the interest (or growth rate) is 2%. So we can substitute the 2% for r.





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