Question

Tammy’s home cost her $184,000. She lives in an area with a lively real estate market, and her home increases in value by 3. 5% every year. If Tammy sells her home after thirteen years, how much profit will she have made, to the nearest hundred dollars? a. $8,500 b. $87,800 c. $83,700 d. $103,800.

Answer 1

The profit to be made when she sells the house is $103,800.

The first step is to determine the value of Tammy's house in 13 years. The formula to be used is:

• FV = P (1 + r)^n
• FV = Future value  
• P = Present value  
• R = interest rate  
• N = number of years  

$184,000 x (1.035)^13 = $287,767.92

Profit = value of the house in 13 years - cost of the house

$287,767.92 - $184,000 = 103,767 = $103,800

To learn more about future value, please check: brainly.com/question/18760477