Suppose we have some money in a savings account earning a fixed interest rate, and we do not withdraw any amount from this account over time. If we wanted to look at the dollars in the account as a function of time, a graph of this function would be _____, becoming _____ over time.
A)decreasing; steeper
B)increasing; steeper
C)increasing; less steep
D)decreasing; less steep

Question

Quizplus · Accepted Answer

The amount of money in a savings account earning a fixed interest rate grows over time due to compound interest, making the graph of the function increasing. Additionally, as the interest compounds, the amount of money added in each period grows, making the graph become steeper over time.

Suppose We Have Some Money in a Savings Account Earning