Michael and Sandy purchased a home for $100,000 5 years ago. If its value appreciated at 6% annually, what is it worth today? (Round the answer to the nearest dollar.)
A) $100,000
B) $106,000
C) $130,000
D) $133,823
E) $135,603

Question

Quizplus · Accepted Answer

To find the value of the home today, we need to use the formula:
Current value = Original value x (1 + annual appreciation rate)^number of years
Current value = $100,000 x (1 + 0.06)^5
Current value = $100,000 x 1.3382
Current value = $133,823 (rounded to the nearest dollar) 
Therefore, the best choice is (D) $133,823.

Michael and Sandy Purchased a Home for $100,000 5 Years