Below are two more situations that can be described using exponential functions. They represent a small sampling of the situations where quantities grow or decay by a constant percentage over equal periods of time. For each situation:

• Find an appropriate unit of time (such as days, weeks, years).

• Find the multiplier that should be used.

• Identify the initial value.

• Write an exponential equation in the form $f(x)=ab^x$ that represents the growth or decay.

1. The value of a car with an initial purchase price of $\$12,250$ depreciates by $11\%$ per year.

   Hint (a):

   If the value of the car decreases by $11\%$ every year, then the car is worth $89\%$ of the cost of it during the previous year.

   Answer (a):

   Years; $0.89;12,250$

   $f(x)=12250(0.89)^{x}$

2. An investment of $\$1000$ earns $6\%$ annual interest, compounded monthly.

   Hint (b):

   Use a similar process as in part (a) above.