if the rate of appreciation in the past year has been 2% of the previous years value what is the current value of a house that was appraised at 800,000 one year ago

Question

Business

Patrick Mcneil

17 September, 08:08

if the rate of appreciation in the past year has been 2% of the previous years value what is the current value of a house that was appraised at 800,000 one year ago

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Whispy · Answer 1

816,000

Explanation:

Since in the past, annual rate of appreciation has been 2%, it is reasonable to assume that the same rate of appreciation will apply in the current year.

Accordingly, for a house appraised at 800,000 one year ago, its current value is calculated as follows.

Current Value = Previous Year's Value * (1 + Appreciation Rate)

= 800,000 * (1 + 2%)

= 800,000 * 1.02

= 816,000