Practice Test Answers

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1
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Based on the graph of the retirement fund modeled by A⁡(t)=100×(1.06)^t , what can be inferred about the fund's growth over time?

A
It will grow exponentially, becoming steeper over time.
B
It will double every year.
C
It will reach a maximum value and then start decreasing.
D
It will increase by a fixed amount each year.
3

Assume that a person always has a balance greater than $⁢1,000 in their bank account. Which best explains why they would likely choose Metro City Bank over First Community Credit Union?

A
because Metro City has a minimum balance requirement
B
because Metro City has a lower overdraft fee
C
because Metro City has a lower out-of-network ATM fee
D
because Metro City has lower wire transfer fees
4

The relationship between the period, T , of a pendulum and the length, L , of the pendulum is best represented by a square root function. Which describes the graph?

A
a constant rate of increase in the period as the length increases
B
accelerating growth where the period doubles for every doubling of the length
C
inversely proportional so the period decreases as the length increases
D
gradually leveling off as the period increases at a decreasing rate
9

Which function increases without bound as x approaches positive infinity?

A
y is equal to negative 3 x cubed plus 1
B
y is equal to 3 x cubed minus 1
C
y is equal to negative 3 x cubed minus 4 x squared
D
y is equal to negative x cubed plus 3 x squared
10

Frances is assessing two different savings options: 1. a high-yield savings account with an annual interest rate of 3.5% , compounded monthly 2. a certificate of deposit (CD) with an annual interest rate of 3.4% , compounded daily Considering the financial data over a one-year period, which statement is accurate about the influence of the compounding periods on the overall earnings?

A
The certificate of deposit will yield a higher amount due to its more frequent compounding, despite its slightly lower interest rate.
B
The high-yield savings account will yield a higher amount due to its higher interest rate, regardless of the compounding frequency.
C
The effect of compounding interest cannot be evaluated without a given initial investment amount.
D
Both savings options will yield the same amount at the end of the year.
11

Priscilla and Braylon each invest $⁢12,000 Priscilla chooses a simple interest account with a 3.5% annual rate, while Braylon opts for a compound interest account with a 3% annual rate, compounded annually. They both plan to invest for 20 years. After 20 years, whose investment will be worth more, and what will be the total amount in each account? Compound Interest Formula: A=P⁢(1+(r)/(n))^n⁢t Simple Interest Formula: A=P⁢(1+r⁢t)

A
Priscilla's account will have more: 21 dollars comma 000 in Priscilla's account, 21 dollars comma 673 point 3 3 in Braylon's account.
B
Priscilla's account will have more: 20 dollars comma 400 in Priscilla's account, 21 dollars comma 673 point 3 3 in Braylon's account.
C
Braylon's account will have more: 21 dollars comma 000 in Priscilla's account, 21 dollars comma 673 point 3 3 in Braylon's account.
D
Braylon's account will have more: 20 dollars comma 400 in Priscilla's account, 21 dollars comma 673 point 3 3 in Braylon's account.
12

What does an exponent of zero imply in an exponential function f⁡(x)=a⋅b^x ?

A
The function equals a.
B
The function equals zero.
C
The function equals b.
D
The function is undefined.
14

Fátima invests $2,000 at a simple interest rate of 2.5% per year. What will be the sequence of amounts in her investment account at the end of each of the first three years?

A
Year 1: $2,100, Year 2: $2,200, Year 3: $2,300
B
Year 1: $2,025, Year 2: $2,050, Year 3: $2,075
C
Year 1: $2,050, Year 2: $2,100, Year 3: $2,150
D
Year 1: $2,050, Year 2: $2,150, Year 3: $2,250

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Practice Test Answers — Financial Math