Adrienne bought a condominium in 2005 for $120,000. She expects it to appreciate 2% per year. Calculate the expected value of the condominium after 7 years.
A) $135,139.49
B) $137,842.28
C) $16,800.00
D) $14,400.00

Question

Quizplus · Accepted Answer

The expected value of the condominium after 7 years can be calculated using the formula for compound interest: Future Value = Present Value * (1 + rate)^number of years. Here, it is $120,000 * (1 + 0.02)^7 = $135,139.49.

Adrienne Bought a Condominium in 2005 for $120,000