When analyzing the exponential function A⁡(t)=100×(1.06)^t for the retirement fund, what role does the 1.06 play in the context of this investment?

In an exponential model, the number multiplied by the initial amount and raised to the time represents the growth factor for each time period. Here, 1.06 means the fund is multiplied by 1.06 each year, equivalent to 6% annual growth. So it is the annual growth factor of the investment.

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