Question

Mark bought a house in 1995 for $200,000. His house has appreciated 4 % every year since he bought it. How much is his house worth today?

Answer 1

Answer:

the worth of the house today is $392,000

Step-by-step explanation:

in 1995 --------- $200,000

and its appreciates by 4% yearly

so by 2019 the house will be

firstly we subtract 2019 from 1995 to know how many years the house has appreciated for

2019 - 1995 = 24years

therefore to get the total % the house has appreciated for we multiply the year by 4%

24 * 4% = 96%

so to get the appreciated value we multiply 96% by the initial amount of the house

96% * $200,000 = $192,000

therefore the worth of the house at present will be the initial amount plus the appreciated value

$200,000 + $192,000 = $392,000

Answer 2

Answer:

$533,167

Step-by-step explanation:

From the question,Mark bought a house in 1995(25 years ago more or less) for $200,000.

His house has appreciated four percent every year since he bought it.

How much is his house worth today

Let P = price of the house in 1995 or initial amount paid for the house

r = percent it appreciates each year or the growth rate

and n = number of years of appreciation( in this case 25 years since we are in 2020)

= P*(1+r/100)^n

or for this particular example of exponential growth

200,000×[(1+4/100)^25]

= 200000×2.6658...6

= 533,167.3

= $533,167