Question 46954: If a piece of real estate purchased for $75,000 in 1998 apppreciates at the rate of 6% per year, then its value t years, then its value t years after the purchase will be f(t)=75,000(1.06t). According to this model, by how much will the value of this piece of property increase between years 2005 and 2008?
NOTE: the t in 1.06 is "to the power". Should it be written like (1.06(t))?
Answer by Nate(3500)   (Show Source):
You can put this solution on YOUR website! f(t) = 75,000(1.06)^t
from 1998 to 2005 is 7 years
from 1998 to 2008 is 10 years
75,000(1.06)^10 - 75,000(1.06)^7
134313.58 - 112772.27 = $21,541.31
It will increase on an exponential level. The higher the  , the greater the increased increment!
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