Value of ring after four years with appreciation of 4 % each year is 4445.46
Given that
Tom bought his fiancée Marie a 3800 diamond engagement ring
Marie discovers that the value of the ring appreciates 4% each year
Need to determine value of ring after four years
Initial value of the ring = 3800
Appreciation of 4% in value means 4% increase
After 1 years , value increases by 4% which means
Value after 1 year = Initial value of the ring + 4% of Initial value of the ring
[tex]\begin{array}{l}{=3800+4 \% \text { of } 3800} \\\\ {=3800+\frac{4}{100} \times 3800=3952}\end{array}[/tex]
After 2 years, value increases by 4% of Value after 1 year which means
Value after 2 years = Value after 1 year + 4% of Value after 1 year
[tex]\begin{array}{l}{=3952+4 \% \text { of } 3952} \\\\ {=3952+\frac{4}{100} \times 3952=4110.08}\end{array}[/tex]
After 3 years, value increases by 4% of Value after 2 years which means
Value after 3 years = Value after 2 years + 4% of Value after 2 years
[tex]\begin{array}{l}{=4110.08+4 \% \text { of } 410.08} \\\\ {=4110.08+\frac{4}{100} \times 4110.08=4274.4832}\end{array}[/tex]
After 4 years , value increases by 4% of Value after 1 year which means
Value after 4 years = Value after 3 years + 4% of Value after 3 years
[tex]\begin{array}{l}{=4274.4832+4 \% \text { of } 4274.4832} \\\\ {=4274.4832+\frac{4}{100} \times 4274.4832=4,445.46}\end{array}[/tex]
Value of ring after four years with appreciation of 4 % each year is 4445.46
