A family bought a new house 10 years ago for $210,000. The house is now worth $302,000. Assuming a steady rate of growth, what was the yearly rate of appreciation?

Question

anonymous · Answer

they need a rate growth though

anonymous · Answer

you would use the equation y=a (1+r)^t

tkhunny · Answer

Okay, then do it that way.  Seems good.  Let's see your work.

Constant RATE of inflation is correct.  Constant AMOUNT of inflation is not correct.

anonymous · Answer

Try starting with
$$\frac{302}{210}=(1+R)^{10}$$ and solve for R.

tkhunny · Answer

Although, it would make more sense to start with $302 = 210(1+R)^{10}$.

anonymous · Answer

I think I solve it ......) y=a (1+r)^t
   302,000=210,000 (1+r)^10
   √(10&1.4351)=√(10&(1+r)^10 )
    1.0370=1+r
      -1         -1
      .037=r
        r= 3.7%

anonymous · Answer

Very good. That's exactly right!

anonymous · Answer

Thank you!