alleryStart learning →Which financial application is named as modelled by exponential functions?
ACompact insurance
BComplete inventory
CCombined inspection
DCompound interest
Answer & Solution
Correct answer: D. Compound interest
1. Interest that is added repeatedly builds on itself.
2. That repeated multiplication is exactly an exponential.
3. The formulas for compound interest are given as exponential models.
4. So the answer is compound interest.
_Source: OpenStax Intermediate Algebra 2e (CC BY 4.0), Ch 10, sections 10.1-10.2 'Evaluate and Graph Exponential Functions'_
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