question 5 of 5 select the correct answer. the expression 10,600(1.0385)^x represents the amount of money in…

question 5 of 5 select the correct answer. the expression 10,600(1.0385)^x represents the amount of money in an investment account with interest that compounds annually for x years. interpret the meaning of the expression. the initial investment is $10,385, and the growth rate of the investment is 1.06%. the initial investment is $10,385, and the growth rate of the investment is 6%. the initial investment is $10,600, and the growth rate of the investment is 1.0385%. the initial investment is $10,600, and the growth rate of the investment is 3.85%.

question 5 of 5 select the correct answer. the expression 10,600(1.0385)^x represents the amount of money in an investment account with interest that compounds annually for x years. interpret the meaning of the expression. the initial investment is $10,385, and the growth rate of the investment is 1.06%. the initial investment is $10,385, and the growth rate of the investment is 6%. the initial investment is $10,600, and the growth rate of the investment is 1.0385%. the initial investment is $10,600, and the growth rate of the investment is 3.85%.

Answer

Explanation:

Step1: Recall compound - interest formula

The compound - interest formula is $A = P(1 + r)^t$, where $A$ is the final amount, $P$ is the principal (initial investment), $r$ is the annual interest rate (as a decimal), and $t$ is the number of years. In the given expression $10600(1.0385)^x$, comparing with the formula, $P$ is the initial investment and $(1 + r)$ is the growth factor.

Step2: Identify the initial investment and growth rate

The initial investment $P$ is the coefficient of the exponential part. Here, $P=$10600$. The growth factor is $1.0385$, so $1 + r=1.0385$, which means $r = 0.0385$ or $3.85%$.

Answer:

The initial investment is $10,600, and the growth rate of the investment is 3.85%.