Question

Write an exponential equation using y = a(b)^x“ thatrepresents the growth or decay of the situation.A house was purchased for $370,000. The house has anannual appreciation rate of 3%. Please write a let statementand an equation that represents the house's value over time.

Answer 1

Let:

PV = Initial value = 370000

r = appreciation rate = 3% = 0.03

x = time

the equation will be given by

$\begin{gathered} y=PV(1+r)^x \\ so\colon \\ y=370000(1+0.03)^x \\ y=370000(1.03)^x \end{gathered}$