Question

Natalie just rented an apartment for $900 a month. She was told that the rent will increase 5.5% each year. About how much will her rent be in 7 years?

Answer 1

$1246. 

This is a guess, though.

Answer 2

The equation you write to solve this should be:

x = 900 (1 + 0.055)^7

x = 900 (1.055)^7

x = 900 (1.454679131133794609375)

x = 1,309.21

*** Note that the answer was rounded to the nearest hundredths digit. ********