<PRE><B>Question 107480</B>
First, a correction. 
If the property appreciates 5% every year, then after the first year,1999.
F(1)=50000(1.05)
After the second year, 2000. 
F(2)=F(1)*(1.05)=50000(1.05)(1.05)={{{50000(1.05)^2}}}
The equation should be 
{{{F(t)=50000(1.05)^t}}}
then
2007 would be the 9th year and 2008 would be the 10th year.
{{{F(9)=50000(1.05)^9}}} and
{{{F(10)=50000(1.05)^10}}}
or 
{{{F(9)=77566}}} and
{{{F(10)=81445}}}
The difference between the 10th year and the 9th year would then be
{{{F(10)-F(9)=3879}}}
C.3880, close enough. 
If you used the original equation, the house value increases only $2500,
after the first year but then increases value by $52,500 every year after.
At the end of the 10th year, the house would be worth $525,000. 
That would be a great profit. </PRE>