Problema Solution
william buys a home for $362,000 his home is predicted to increase in value of 4.5% each year what is the predicted value of his home in 20 years
Answer provided by our tutors
P = $362,000 the start value of the home
r = 0.045 or 4.5% annual increase rate
t = 20 years
A = the value of the home after 20 years
A = P(1 + r)^t
A = 362000(1 + 0.045)^20
A = $873,040.48
The predicted value of the home in 20 years is $873,040.48.