Respuesta :
Answer:
The annual interest is,
Option d is correct
5%
The bank compounds the interest_
Option a is correct.
Annually.
The balance of the account will grow,
Option b is correct
exponentially
Step-by-step explanation:
Exponential growth function is given by:
[tex]y=(1+r)^x[/tex] .....[1]
where,
r is the annual interest in decimal
x is the number of periods.
As per the statement:
Consider the function:
[tex]y=(1.05)^{\frac{x}{12}}[/tex] where, x represents the time in months.
On comparing with [1] we have;
[tex]1+r = 1.05[/tex]
Subtract 1 from both sides we have;
r = 0.05 = 5%
The annual interest is, 5%
and
the bank compounds the interest annually.
The balance of the account will grow exponentially
