Ben Collins plans to buy a house for $180,000. If the real estate in his area is expected to increase in value by 1 percent each year, what will its approximate value be seven years from now? Use Exhibit 1-A. (Round your FV factor to 3 decimal places and final answer to the nearest whole dollar.)

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Business

Azul Haney

18 August, 00:11

Ben Collins plans to buy a house for $180,000. If the real estate in his area is expected to increase in value by 1 percent each year, what will its approximate value be seven years from now? Use Exhibit 1-A. (Round your FV factor to 3 decimal places and final answer to the nearest whole dollar.)

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Answers (1)

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Joyce Schmitt · Answer 1

The approximate value of the house is 192984

Explanation:

I don't know what you mean by "Use Exhibit 1-A" but you can calculate this as follows

180000 * (1+1%) ^7

The general formula of cumulative interest is

A * (1+i) ^n

A = Amount

i = interest, in this case 1%

n = number of periods, in this case, 7