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Exponential Growth and Decay

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The word problems in this lesson cover exponential growth and decay. An example of an exponential growth word problem is the following: '$1000 is invested at 9% interest compounded annually. Find the value of the investment after 5 years.' An example of an exponential decay word problem is the following: 'The value of a new $35,000 car decreases by 20% per year. Find the value of the car after 10 years.' Notice that exponential growth word problems often involve compound interest, and exponential decay word problems often involve depreciation.

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