document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=107480>Question 107480</A>: <I><SPAN STYLE=\"word-break: break-all;\"> If a piece of real estate purchased for $50,000 in 1998 appreciates at<BR>\n" );
document.write( "the rate of 5% per year, then its value t years after the purchase will<BR>\n" );
document.write( "be f (t) = 50,000(1.05t ) . According to this model, by how much will the<BR>\n" );
document.write( "value of this piece of property increase between the years 2007 and<BR>\n" );
document.write( "2008?<BR>\n" );
document.write( "a. $2500<BR>\n" );
document.write( "b. $3140<BR>\n" );
document.write( "c. $3880<BR>\n" );
document.write( "d. $31,400 </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #78283 by </B><A HREF=/tutors/aboutme.mpl?userid=Fombitz><B>Fombitz(32388)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Fombitz><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Fombitz><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=78283\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> First, a correction. <BR>\n" );
document.write( "If the property appreciates 5% every year, then after the first year,1999.<BR>\n" );
document.write( "F(1)=50000(1.05)<BR>\n" );
document.write( "After the second year, 2000. <BR>\n" );
document.write( "F(2)=F(1)*(1.05)=50000(1.05)(1.05)=<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=50000%281.05%29%5E2 ALIGN=MIDDLE  ALT=\"50000%281.05%29%5E2\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "The equation should be <BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=F%28t%29=50000%281.05%29%5Et ALIGN=MIDDLE  ALT=\"F%28t%29=50000%281.05%29%5Et\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "then<BR>\n" );
document.write( "2007 would be the 9th year and 2008 would be the 10th year.<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=F%289%29=50000%281.05%29%5E9 ALIGN=MIDDLE  ALT=\"F%289%29=50000%281.05%29%5E9\"   DISABLED_style= \"max-width:90%; height:auto;\" > and<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=F%2810%29=50000%281.05%29%5E10 ALIGN=MIDDLE  ALT=\"F%2810%29=50000%281.05%29%5E10\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "or <BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=F%289%29=77566 ALIGN=MIDDLE  ALT=\"F%289%29=77566\"   DISABLED_style= \"max-width:90%; height:auto;\" > and<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=F%2810%29=81445 ALIGN=MIDDLE  ALT=\"F%2810%29=81445\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "The difference between the 10th year and the 9th year would then be<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=F%2810%29-F%289%29=3879 ALIGN=MIDDLE  ALT=\"F%2810%29-F%289%29=3879\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "C.3880, close enough. <BR>\n" );
document.write( "If you used the original equation, the house value increases only $2500,<BR>\n" );
document.write( "after the first year but then increases value by $52,500 every year after.<BR>\n" );
document.write( "At the end of the 10th year, the house would be worth $525,000. <BR>\n" );
document.write( "That would be a great profit.  </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );