### Home > INT3 > Chapter 6 > Lesson 6.3.1 > Problem6-85

6-85.

Suppose that a two-bedroom house in Nashville is worth $110,000$ and is appreciating at a rate of $2.5\%$ each year. Homework Help ✎

1. How much will it be worth in 10 years?

$y = ab^x$

Let $x =$ number of years and $y =$ value of house. $a$ is the initial value of the house and $b$ is the multiplier.

$y = 110,000(1.025)^x$

2. When will it be worth $200,000$?

Using the equation in part (a), guess and check values for $x$. Your answer will be approximate.

3. In Homewood, houses are depreciating at a rate of $5$% each year. If a house is worth $182,500$ now, how much will it be worth two years from now?

Write another equation. Note that the value is depreciating this time.