A home’s value increases at an average rate of 5.5% each year. The current value is $120,000. What function can be used to find the value of the home after x years?
f(x) = 120,000(1.055)x
f(x) = 120,000(0.055)x
f(x) = 120,000(1.055)x
f(x) = [(120,000)(1.055)]x

Question

A home’s value increases at an average rate of 5.5% each year. The current value is $120,000. What function can be used to find the value of the home after x years?
f(x) = 120,000(1.055)x
f(x) = 120,000(0.055)x
f(x) = 120,000(1.055)x
f(x) = [(120,000)(1.055)]x

anonymous · Answer

5.5% converted to a decimal is 0.055. 
However, the house already retains 100% of it's value each year, with 5.5% as an increase.
Therefore, it is (1.055x))*(120000), giving you the first or third answer (they're the same? if one is raised to the x power, then that one is wrong)