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Home > A2C > Chapter 7 > Lesson 7.2.4 > Problem 7-147

7-147.
  1. Suppose that a two-bedroom house in Nashville is worth $110,000 and appreciates at a rate of 2.5% each year. Homework Help ✎

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

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

    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?

General form: y = abx

Let x = number of years and y = value of house. Write an equation using the general form of the exponential equation.

a is the initial value of the house, and b is the multiplier.

y = 110,000(1.025)x

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

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