Question

One model for home appreciation is as follows, where C is the original cost, V is the value of the home after t years, and b is the rate of appreciation.

V = Ce^bt

If the original cost of the home was $185,000 and the rate of appreciation is 8%, what will be the value of the home after 8 years? [Round to the nearest dollar.]

$350,849
$197,227
$1,184,000
$200,408

Answer 1

Is e a part of the formula?

Answer 2

ya i believe so

Answer 3

If so what do it represent? They have mentioned nothing about e in the description right?

Answer 4

Ha there u go

Answer 5

It is Ce^bt earlier u mentioned it Cebt which confused me :)

Answer 6

So now we have C as $185,000

b as 8% which can be 8/100

and t as 8 years

V = 185000*e^(8/100*8)
V = 185000*e^(64/100) = 185000*e^(0.64)

Simplify it and you get the answer

Answer 7

A