Question

Question 33
Mr. Jones bought a piece of property for
$25,000. If the property appreciates at
a rate of 10% per year, what will be its
approximate value in 73 years?

Answer 1

Answer:

I'm unsure if this is correct but, the answer should be $18,250,000.

- Starting price = $25,000

- Increases at the rate of 10% per year

- Value in 73 years = ?

- 10 x 73 = 730%

- 25,000 x 730 = $18,250,000

- Again, sorry if it's not right..

Answer 2

Answer:  $26,278,829.99

Step-by-step explanation:

The property appreciates at the same rate each year so this is an exponential function of the form   $A=P(1+r)^t$   where

• A is the Accrued amount (total)
• P is the Principal amount (initial/starting amount)
• r is the Rate of appreciation (convert percent to decimal)
• t is the Time (in years)

Given: P = 25,000    r = 10% (0.1)   t = 73

A = 25,000(1 + 0.1)⁷³

A = 25,000(1.1)⁷³

A = 26,278,829.99      (rounded to two decimal places)