An initial investment of $500 grows to $600 in 2 years. The annual growth rate, expressed as a decimal, is ________ (Round the result to four decimal places.).
Answer & Analysis
Analysis
Question Analysis
This problem assesses the ability to calculate the annual growth rate in an exponential growth model.
Key Concept Explanation
The formula for exponential growth is , where is the amount after years, is the initial amount, is the annual growth rate, and is the time in years.
Step-by-step Solution
1. Identify the given values: , , and .
2. Substitute these values into the formula:
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