Growth and Decay

Growth and Decay

• Exponential growth and decay problems are often associated with compound interest problems, or looking at the rate of virus’ increasing or decreasing.

• They use an exponential function such as y=kx or y=k-x k stands for a constant.

• This graph shows y=3x

Compound interest

• If you leave your money in a savings account it will earn compound interest
• For example Saanvi invests £40000 at a compound interest rate of 3% per annum
• To calculate amount after 3 years you can do 40,000 x 1.03(3)
    * 1.03 as its 103% added each time
    * power of 3 as its for 3 years
• In life this can be used in banking

Golden rule

• You can use this rule to calculate a repeated percentage change
• final amount = (starting amount) x (multiplier)n
• n is the number of times the change is made