A house is worth $200,000 at the time of purchase. The market falls and the house needs some repairs when the owners try to sell it again. They sell their house for $115,000 eight years later. By how much did the value of the house drop each year on average?

Question

Quizplus · Accepted Answer

When calculating loss of value, first we find the amount the value changed by: $200,000 - $115,000 = $85,000 Then we divide the change in value by the time: ^$85,000/_{8 years} = $10,625 each year

A House Is Worth $200,000 at the Time of Purchase