Housing values are appreciating at a rate of 3 percent a year.Approximately how much will your $100,000 house be worth in ten years if this rate of appreciation continues?
A)$134,390
B)$146,320
C)$155,080
D)$174,410

Question

Quizplus · Accepted Answer

The value of the house after ten years can be calculated using the formula for compound interest: $P(1 + r)^n$, where $P$ is the principal amount ($100,000), $r$ is the annual rate of increase (0.03), and $n$ is the number of years (10). Plugging in these values gives $100,000(1 + 0.03)^{10} = 100,000(1.03)^{10} ≈ $134,390$.

Housing Values Are Appreciating at a Rate of 3 Percent